Outsourcing Agreement

OUTSOURCING AGREEMENT


This ASP and Outsourcing Agreement ("Agreement") is entered into as of this 31 day of July, 2000 ("Effective Date") by and between E.PIPHANY, INC., a Delaware corporation ("E.piphany"), whose principal place of business 1900 South Norfolk Street, Suite 310, San Mateo, California 94403 and HIGH SPEED NET SOLUTIONS, INC. ("HSNS"), whose principal place of business is 434 Fayetteville Street, St. Suite 2120, Raleigh, NC 27601.


1. LICENSE


1.1 OUTSOURCING LICENSE. Subject to the terms of this Agreement and Scope of Use and only within the Market and Territory, E.piphany grants HSNS a nonexclusive, nontransferable, non-sublicensable right to (i) use and combine the Application with the Outsourcing Application and other software products for the purpose of providing, to Outsourcing Customers, the services described in Exhibit B as the Outsourcing Services; and (ii) use the Documentation provided with the Application in support of the Application. Unless otherwise required by the Scope of Use, HSNS shall limit its use of the Application to the Designated System. HSNS shall ensure that at all times the Outsourcing Services contain only one (1) version of the Application regardless of the number of Outsourcing Customers and Outsourcing Customers access the Outsourcing Application and Outsourcing Services only through a customer interface. Under no circumstances shall HSNS permit an Outsourcing Customer or Outsourcing Customer User to have direct access to any Application Licensed hereunder.


1.2 DEVELOPMENT LICENSE. Subject to the terms and conditions of this Agreement and Scope of Use and only within the Market and Territory, E.piphany grants to HSNS a non-exclusive, non-transferable, non-sublicensable license during the term of this Agreement to install and use the Applications in object code format to develop the Outsourcing Application and Outsourcing Service and to install and use the Application in object code format to develop and provide maintenance and support for the Outsourcing Application to Outsourcing Customers, to demonstrate the Outsourcing Application to potential customers, and to train HSNS personnel on the use, maintenance and support of the Outsourcing Application.


1.3 COPIES. HSNS may make a reasonable number of copies (not more than five (5)) of the Application for archival purposes, and a reasonable number of copies of the Documentation as needed by HSNS solely for HSNS' internal use, provided all copyright and proprietary notices are reproduced. HSNS may make one (1) copy of the end user sections of the Documentation for each Outsourcing Customer. All titles, trademarks, copyright and restricted rights notices shall be reproduced in such copies. HSNS shall not use any Applications that E.piphany delivers with licensed Application, for which HSNS has not purchased a license.


1.4 LICENSE RESTRICTIONS. Except as expressly provided herein, HSNS shall not (i) rent, lease, loan, sell or otherwise distribute the Application, or any modification thereto, in whole or in part; (ii) cause or permit reverse engineering, reverse compilation, unauthorized access or assembly of all or any portion of the Application; (iii) allow any outsourcing or application service providers to access and use the Application as Outsourcing Customers, (iv) publish the results of Application performance benchmarks to any third party without E.piphany's express written consent; (v) export the Application in violation of U.S. Department of Commerce export administration regulations; and (vi) except as otherwise expressly allowed herein, permit any third party or unlicensed user or computer system to access or use the Application. HSNS agrees that it shall only provide the Application in combination with and included in Outsourcing Services HSNS acknowledges and agrees that the rights granted herein are solely to the English version of the Application. All rights not expressly granted hereunder are reserved to E.piphany.


2. HSNS OBLIGATIONS.


2.1 ANNUAL REPORTS. On the thirtieth (30th) day after the end of each of the first two years of this Agreement, HSNS shall submit to E.piphany a report (in a form provided by E.piphany and reasonably acceptable to HSNS) listing (i) the total number of emails distributed for Years 1 and 2 and (ii) the Application with which the Outsourcing Services are rendered. Year 2 and Year 3 Quarterly Payments, as defined in Exhibit "A," shall be based upon these annual reports. All reporting and payment requirements under this Section shall be subject to the audit requirements of this Agreement.


2.2 PROFESSIONAL MANNER. HSNS agrees that, at all times and in every respect during the term of this Agreement, it shall conduct its business in a professional manner consistent with E.piphany's norms and standards, which shall reflect favorably upon E.piphany and the Application.


2.3. MARKETING ACTIVITIES. The parties agree to develop a co-branding plan within thirty (30) days of signing of the Agreement. The parties shall use reasonable efforts to take part in the other's success stories or other marketing programs as mutually agreed.


2.4. PROMOTION OF THE APPLICATION AND THE OUTSOURCING APPLICATION AND SERVICES. HSNS shall, at its own expense, promote the distribution of the Application and the Outsourcing Application and Services. Such promotion shall include, but not be limited to, advertising in trade publications, participating in appropriate trade shows and seminars, and directly soliciting orders for use of the Outsourcing Application and Outsourcing Services. HSNS shall distribute to all HSNS sales offices marketing materials for the Application, which may be provided by E.piphany to HSNS or that may be created by HSNS, in which case they shall be subject to E.piphany approval, including any brochures describing the functional nature of the Application, its features, and advantages.


2.5. HSNS REPRESENTATIONS. HSNS shall make no representations concerning the functionality or performance characteristics of the Application, except as set forth in the printed Documentation or other materials furnished to HSNS by E.piphany. As appropriate, HSNS shall include references to E.piphany and the Application in all of its presentations and sales materials created during the term of this Agreement, which relate to the Application.


2.6. FORECASTING. HSNS shall meet with E.piphany on a quarterly basis at a mutually agreed to date and time to discuss non-binding forecasts. HSNS shall provide E.piphany with a non-binding, rolling six-month forecast report in advance of the quarterly meeting.


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2.7. UPDATES. HSNS agrees to provide E.piphany with notice of any changes in the Outsourcing Applications and Outsourcing Service.


2.9. SUPPORT TO CUSTOMERS. HSNS shall be the Outsourcing Customer interface and shall provide all direct communications and services to and from HSNS's Customers with respect to all support, maintenance and warranty services. E.piphany shall have no obligation to provide support, maintenance or warranty services to Outsourcing Customers.


2.10. TRAINING. HSNS shall take the training classes described on Exhibit C.


3. PAYMENT


3.1 FEES. HSNS shall pay E.piphany the fees specified in Exhibit A and generated by HSNS's use of the Application as specified in an applicable Annual Report.


3.2 PAYMENT TERMS. Except as provided in Section 2.1 above, and unless otherwise agreed and specified in Exhibit A, all amounts due and owing by HSNS shall be paid within thirty (30) days from the date of E.piphany's invoice. Overdue payments shall accrue a late payment charge at the lesser of one and one half percent (1 1/2%) per month or the maximum rate allowed under applicable law. All payments made hereunder are non-cancelable and non-refundable. All fees are payable in U.S. dollars and shall be payable to E.piphany, Inc. by company check, or via wire transfer to the following account: Silicon Valley Bank - Santa Clara, ABA: 121140399, Account: 3300109833, Money Market.


3.3 TAXES. HSNS is responsible for all taxes (including sales, use, property and value-added taxes), duties and customs fees concerning the Application and/or services, excluding taxes based on E.piphany's income.


3.4 AUDIT. HSNS shall maintain complete and accurate records of its activities under this Agreement for at least two (2) years following termination of this Agreement. HSNS agrees to allow E.piphany, directly or indirectly, to audit HSNS's business records as kept by HSNS in its normal course of business to ensure compliance with the terms and conditions of this Agreement. If the audit reveals that HSNS has failed to comply with the terms of this Agreement, in addition to all other remedies available to E.piphany at law or equity, HSNS shall immediately reimburse E.piphany for any unpaid amounts due and the cost of the audit.


4. WARRANTY


4.1 BY E.PIPHANY. E.piphany warrants that for a period of one (1) year from Effective Date, the Application as used within the scope of this Agreement will perform substantially in accordance with the functions described in the Documentation. E.piphany warrants the Application media is free from material defects in materials and workmanship under normal use for ninety (90) days from the applicable Order Form. E.piphany further warrants that its Maintenance, training and Professional Services will be rendered consistent with generally accepted industry standards for a period of ninety (90) days from performance of such services.


4.2 EXCLUSIVE REMEDIES. For any breach of the warranties contained in Section 4.1, HSNS's sole and exclusive remedy, and E.piphany's entire liability, shall be: (i) in the case of a nonconforming Application, to correct the nonconforming Application, provided that HSNS notifies E.piphany of the nonconformity within the warranty period and HSNS has installed all Updates and, if E.piphany is unable to do so, HSNS shall be entitled to terminate the Application license and recover the fees paid to E.piphany for such Application; (ii) in the case of defective media, to replace such defective media, provided that HSNS returns such defective media during the warranty period; (iii) in the case of infringing Application, the indemnity contained in Section 10.1 ("E.piphany Intellectual Property Indemnify") and (iv) in the case of services to which the breach of warranty relate, the correction of defective work so as to comply with generally accepted industry standards. If E.piphany is unable to perform such services as warranted, HSNS shall be entitled to recover the fees paid to E.piphany for the unsatisfactory services. This limitation of liability applies notwithstanding any failure of the essential purpose of the exclusive remedies.


4.3 DISCLAIMER. THE WARRANTIES SET FORTH IN SECTION 4.1 ARE EXCLUSIVE AND IN LIEU OF AND E.PIPHANY DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS, STATUTORY OR IMPLIED, INCLUDING ANY WARRANTIES OF MERCHANTABILITY, TITLE OR FITNESS FOR A PARTICULAR PURPOSE. E.PIPHANY DOES NOT WARRANT THAT THE APPLICATION WILL OPERATE IN COMBINATIONS OTHER THAN AS SPECIFIED IN THE DOCUMENTATION OR THAT THE OPERATION OF THE APPLICATION WILL BE UNINTERRUPTED OR ERROR-FREE. PRE-PRODUCTION RELEASES OF APPLICATIONS OR COMPUTER-BASED TRAINING PRODUCTS ARE DISTRIBUTED "AS-IS."


5. MAINTENANCE


5.1 FOR HSNS UNDER LICENSES. E.piphany will provide the Maintenance described below, provided HSNS remains a compliant subscriber to such Maintenance and has paid all monies due therefor. Upon reasonable notice, E.piphany reserves the right to modify the terms and conditions of Maintenance, provided that any such modification will not substantially diminish the level of Maintenance that HSNS is then currently receiving.


5.2 ERROR CORRECTION. E.piphany shall use reasonable efforts to provide workarounds for, and to correct reproducible programming errors in, the Application attributable to E.piphany with a level of effort commensurate with the severity of such errors and in accordance with the terms of Section 5.3 ("Response Times"). Upon identification of any programming error, HSNS shall notify E.piphany of such error and shall provide E.piphany with information sufficient to locate and duplicate the error.


5.3 RESPONSE TIMES. PRIORITY 1: Response in under fifteen (15) minutes for instances in which the Application is down (product is unusable resulting in total disruption of use or outage of the Application). PRIORITY 2: Response in under one (1) hour during technical support desk hours for a major feature or function failure, which results in the operation of the Application being restricted. PRIORITY 3: Response in under four (4) hours during technical support desk hours for a minor feature or function failure which results in the Application not working as described in the Documentation and with minor impact on usage. PRIORITY 4: Response in under eight (8) hours during technical support desk hours for a minor problem or feature request that does not impact usability of the Application. In each instance, E.piphany will, after the initial response, within a time frame mutually agreed upon by the parties, provide HSNS with an action plan for resolution, if possible, of the error. Priority 4 errors may, in E.piphany's


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discretion, be corrected by E.piphany in the next release of the Application.


5.4 SUPPORT. DESK. E.piphany allows for unlimited calls to its technical support desk by the HSNS personnel designated under Section 5.7 ("HSNS Responsibilities.") The technical support desk hours of operation are from 7:00 a.m. until 6:00 p.m. Pacific Time, Monday through Friday except holidays. During the off hours, the technical support desk can be reached via pager, twenty four (24) hours a day for Priority 1 errors.


5.5 UPDATES. E.piphany will, from time to time, provide to HSNS all applicable Updates to the Application, that are commercially released by E.piphany during the term of this Agreement.


5.6 HSNS'S RESPONSIBILITIES. As a condition to the provision of workarounds and error corrections, HSNS will (i) appoint two (2) employees to serve as primary contacts between HSNS and E.piphany, and will ensure that HSNS's support inquiries are initiated and handled through these contacts; (ii) provide E.piphany with reasonable access to all necessary personnel to provide information regarding errors or problems reported by HSNS; and (iii) provide E.piphany with Remote Access, subject to HSNS's consent.


5.7 EXCLUSIONS. E.piphany shall not be required to provide workarounds or error corrections relating to problems resulting from (i) HSNS's failure to implement all Updates to the Application which are provided under this Agreement; (ii) any alterations of, or additions to, the Application performed by parties other than E.piphany; (iii) any previous or earlier versions of the Application except for the immediately prior version of the Application; (iv) any request for additional work not falling within the scope of E.piphany's Maintenance outlined in this Section 5; or (v) interconnection of the Application with hardware or Application products not supplied by E.piphany.


5.8 SECONDARY SUPPORT TO HSNS. In the event HSNS is unable to resolve errors identified by Outsourcing Customers with respect to the Application, E.piphany shall provide Secondary Support services to HSNS at the fee set forth on Exhibit A. For the purposes of this Agreement, "SECONDARY SUPPORT SERVICES" shall mean: (a) using reasonable efforts to modify the Application to correct, fix, or circumvent errors, and modifying Documentation, as E.piphany shall deem appropriate, to respond to reported errors; (b) providing technical and functional improvements to the Application including patches to errors, changes, modifications, enhancements, and Updates, as they generally become available; and (c) providing technical support services for the Application between the hours of 7:00 a.m. to 6:00 p.m. (Pacific Time), Monday through Friday.


6. PROFESSIONAL SERVICES


6.1 SERVICES. E.piphany may from time to time perform Professional Services as may be agreed upon by the parties in an Order Form.


6.2 FEES, EXPENSES AND INVOICING. HSNS shall pay E.piphany the fees set forth in the applicable Order Form, together with reimbursement for all actual, reasonable travel and living expenses incurred by E.piphany in rendering Professional Services. E.piphany will invoice HSNS on a monthly basis for Professional Services rendered and for any applicable expense reimbursement. All Professional Services not otherwise specified in the Order Form shall be provided on a time and materials basis.


6.3 PERFORMANCE STANDARDS. E.piphany shall perform Professional Services in a timely and competent manner consistent with generally acceptable industry standards. Upon reasonable notice to HSNS, E.piphany may substitute or withdraw personnel rendering Professional Services.


6.4 ACCEPTANCE. Each Deliverable shall be deemed accepted upon the earlier of: (i) receipt of written notice of acceptance from HSNS, or (ii) ten (10) days after delivery of such Deliverable ("Acceptance Period"), unless HSNS provides E.piphany with a detailed list of material non-conformities during the Acceptance Period. If HSNS properly rejects a Deliverable, E.piphany will use reasonable commercial efforts to correct the material non-conformity specified in the notice. When it believes that it has made the necessary corrections, E.piphany will again deliver the Deliverable to HSNS and the acceptance/ rejection/correction process shall be reapplied until the Deliverable substantially complies with the requirements of the Statement of Work.


6.5 CHANGE CONTROL. Any change to the scope of a project, any Deliverable, milestone or payment obligation contained in an Order Form (and/or the attached Statement of Work) shall be made only in writing and signed by authorized representatives of E.piphany and HSNS. Unless otherwise agreed by the parties in writing, E.piphany shall have no obligation to provide Professional Services (i) beyond the scope of matters expressly described in the Order Form (and attached Statement of Work); or (ii) which becomes necessary as a consequence of events beyond E.piphany's reasonable control.


6.4 OWNERSHIP OF DELIVERABLES. HSNS acknowledges and agrees that any and all Deliverables shall be and remain the property of E.piphany. E.piphany grants HSNS a non-exclusive, non-transferable, non-sublicensable license to use such Deliverables solely for is internal use consistent with the terms of this Agreement.


6.5 HSNS RESPONSIBILITIES. HSNS shall provide E.piphany with (i) one (1) designated contact for all questions and issues relating to Professional Services; (ii) access to HSNS's facilities and office support as may be reasonably requested by E.piphany; and (iii) the services of sufficiently qualified HSNS personnel as may be reasonably necessary to enable E.piphany to perform the Professional Services.


7. TRAINING SERVICES


7.1 TRAINING SERVICES. In consideration for payment of the fees and charges set forth in Exhibit A, E.piphany shall provide Training Services as set forth in Exhibit C. The training sessions will take place at E.piphany's facilities and E.piphany will supply all necessary equipment. HSNS shall be responsible for all travel and lodging expenses associated with attending the training session.


7.2 ADDITIONAL TRAINING SERVICES. HSNS may, at its option and expense, attend additional E.piphany training courses, dependent upon space availability. Any additional training shall be provided at E.piphany's standard rates for such training, and will take place at E.piphany's facilities. HSNS shall be responsible for all travel and lodging expenses associated with attending the additional training session ...