Exhibit 10.13
CONFIDENTIAL
CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.
AGREEMENT
This Agreement (the "Agreement") is entered as of the _____ day of
September, 1998, by and between Commerce One, Inc. ("C1"), a California
corporation with a principal place of business at 0000 Xxxxxxx Xxxxxx, Xxxxxx
Xxxxx, Xxxxxxxxxx 00000 and PricewaterhouseCoopers LLP ("PwC"), a registered
Delaware limited liability partnership with offices located at 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, XX 00000 (each, a "Party" and together the "Parties").
C1, among other things, develops, markets, sells and supports
enterprise-level software applications and services that enable businesses and
their suppliers to engage in electronic procurement and supplier management over
the Internet and other communications media (the "C1 Software").
PwC, among other things, assists companies like C1 in the development,
marketing, and sale of such software systems and services and implements and
supports these systems for customers who have purchased them.
Because of the complementary knowledge and expertise of the Parties,
the Parties desire to enter into an alliance under which they will work together
to develop, market, sell, implement and support the C1 Software.
Now, therefore, in consideration of the mutual promises contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, the Parties agree as
follows:
1. DEFINITIONS
As used herein, the following terms shall have the following meanings:
(a) "Agreement" shall mean this Agreement by and among
the Parties.
(b) "C1 Software" shall mean all software products of C1,
including without limitation, those relating to electronic procurement and
supplier management, (including their constituent elements and code in whatever
form, whether proprietary to C1 or others) as they now exist or as they are
further developed and shall include all software, related databases, design
elements, custom applications, preexisting code or applications, code
frameworks, methods and standards, including without limitation, all
documentation (in whatever form or medium), end user manuals, user's guides and
technical manuals proprietary to C1.
(c) "Confidential Information" means any information in
whatever form, and however delivered or communicated, including, without
limitation, all code, documentation,
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product plans, Trade Secrets, business plans, customer lists, know-how, and all
other information of whatever nature related to or incorporated into C1 Software
or the business of C1 or PwC or any subsidiary or other business entity which is
an affiliate of C1 or PwC (such subsidiary or business entity referred to
collectively as "C1" or "PwC", as the case may be) and which is reasonably
understood to be of a confidential nature. Confidential Information includes
information of others that C1 or PwC has agreed to keep confidential.
Confidential Information of PwC specifically includes information relating to
any bids or proposals made by PwC in relation to the implementation of or the
provision of consulting services relating to the C1 Software. Confidential
Information of a Party shall not include information or materials that is
disclosed to the other party (the "Receiving Party") that is:
(i) otherwise rightfully known to the Receiving
Party;
(ii) in the public domain through no fault of the
Receiving Party;
(iii) lawfully obtained by the Receiving Party from a
third party without breach of such third party's obligations of confidentiality;
or
(iv) that a Receiving Party is required to disclose
by legal process; provided, however, that voluntary disclosure beyond that which
is required by law shall constitute a violation of this Agreement.
(e) "Trade Secrets" shall mean technical or other
information, designs, processes, procedures, algorithms, formulas, improvements,
or modifications disclosed to PwC by C1 or to C1 by PwC, that are commercially
valuable and secret. Trade Secrets are unique assets of C1 or PwC that give C1
or PwC a competitive advantage over competitors that do not possess such
information. Trade Secrets include, but are not limited to, system designs and
specifications, programming sequences, algorithms, flow charts, and formulas,
developed in whole or in part by C1 or PwC.
(f) "Upgrades" shall mean a new version of a proprietary
product to which additional or incremental functionality has been added.
2. COOPERATION IN C1 SOFTWARE DEVELOPMENT AND IMPLEMENTATION
2.1 ESTABLISHMENT OF THE TRC. To enhance the performance, development
and implementation of C1 Software, the Parties will establish a Technical Review
Committee ("TRC"). The intended objective of the TRC is to provide advice to C1
regarding functionality, priorities, release schedules, and use of development
resources.
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2.2 SCOPE OF THE TRC'S REVIEW. The TRC shall be charged with reviewing
the performance of the C1 Software, all developments or potential developments
to the C1 Software and the implementation of the C1 Software.
2.3 MEMBERSHIP OF THE TRC. The TRC shall be composed of three C1
employees selected by C1 who are involved in and knowledgeable about the
performance and development of C1 Software and three PwC employees selected by
PwC who are involved in and knowledgeable about the implementation of C1
Software. C1 and PwC may at any time with notice to the other Party change their
employees designated to serve as members of the TRC. Each Party represents that
its designated members of the TRC are authorized to act on that Party's behalf
on all matters that come before the TRC.
2.4 MEETINGS AND REPORTS. The TRC shall meet at least quarterly to
review and assess the performance of the C1 Software, all developments or
potential developments to that software and the implementation of that software.
At least once every six months, the TRC shall issue a report to C1 and PwC
reviewing and assessing in detail the above. In the event that the members of
the TRC do not concur in their review and assessment, the report shall so state
and shall set forth separately the review and assessment of all members.
2.5 OBLIGATION TO PROVIDE INFORMATION TO THE TRC. C1 and PwC shall each
promptly provide to the TRC all material information known or available to each
of them relating to the performance of the C1 Software, all material
developments or potential developments to the C1 Software, and the
implementation of the C1 Software. This obligation includes but is not limited
to providing the TRC with all Beta releases, with all information relating to C1
Software Upgrades, and with all information relating to problems with C1
Software performance or implementation.
3. OPERATION IN C1 SOFTWARE MARKETING
3.1 ESTABLISHMENT OF MDC. To enhance the marketing of C1 Software, the
Parties will establish a Marketing Development Committee ("MDC").
3.2 SCOPE OF THE MDC'S REVIEW. The MDC shall be charged with developing
and overseeing the joint marketing of C1 Software based upon the initial
marketing plan and budget to be agreed upon and entered into by the Parties
within 30 days of the date hereof (the "Marketing Plan"). The MDC shall agree
upon not less than five customers to serve as beta integration sites with
respect to the C1 Software. The MDC shall also identify each party's commitments
and obligations, including joint activities. The MDC shall consider using
marketing tools such as, among other things, magazine inserts in publications
such as Forbes, methodology books (for pre-sale), PwC sponsored conferences, and
training forums.
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3.3 COMMITMENT OF THE PARTIES. The specific monetary and in-kind
commitments of the Parties shall be determined by the MDC in accordance with the
Marketing Plan; provided, however, PwC agrees that it shall spend a minimum of
$250,000 the first year this Agreement is in effect pursuant to jointly approved
plans for the marketing of the C1 Software. Thereafter, the Parties shall
determine in good faith the amount per year that each Party shall commit to the
marketing of the C1 Software; provided that in the event that the parties are
unable to agree upon the minimum amount to be spent by PwC for marketing in any
subsequent year, the minimum amount shall be $250,000.
3.4 MEMBERSHIP OF THE MDC. The MDC shall be composed of two C1
employees selected by C1 and two PwC employees selected by PwC, all of whom are
involved in the marketing of C1 Software. C1 and PwC may at any time with notice
to the other Party change their employees designated to serve as members of the
MDC. Each Party represents that its designated members of the MDC are authorized
to act on that Party's behalf on all matters that come before the MDC; provided
that in no event shall the MDC have the authority to modify the terms of this
Agreement
3.5 MEETINGS. The MDC shall meet at least quarterly to develop and
oversee C1 Software marketing.
3.6 PUBLICITY. The MDC shall establish guidelines governing all news
releases, public announcements, or any other mass publicity, including without
limitation, mass-produced marketing materials, which makes reference to PwC or
includes a Xxxx (as defined below) of PwC or New Xxxx (as defined below)
(collectively, "Publicity") to be released by either Party relating to C1
Software. Notwithstanding the foregoing, C1 shall not release any Publicity
relating to PwC unless such Publicity is approved by PwC. The MDC shall
establish guidelines governing all news releases, public announcements, or any
other publicity which makes reference to C1 or includes a Xxxx (as defined
below) of C1 (collectively, "C1 Publicity") to be released by either Party
relating to C1 Software. Notwithstanding the foregoing, PwC shall not release
any C1 Publicity relating to C1 unless such C1 Publicity is approved by C1.
3.7 TRADEMARKS, LOGOS, TRADE NAMES AND SERVICE MARKS. The MDC shall
establish written guidelines governing the use by a Party of trademarks, logos,
trade names and service marks (together "Marks") of the other Party or any
successor entity to either of the Parties; provided, however, C1 shall not use
PwC's Marks unless the use is approved by PwC and PwC shall not use C1's Marks
unless the use is approved by C1. Notwithstanding any other provision contained
herein or in any guidelines established by MDC, in the event that PwC gives C1
notice that it is terminating this Agreement pursuant to Section 11.3.2, C1
shall immediately cease, and in the event the Agreement is terminated for any
other reason, upon termination C1 shall cease, the use of the names "Price
Waterhouse," "PricewaterhouseCoopers", the xxxx "PW," "PwC," any derivations
thereof or any other xxxx proprietary to PwC, including without limitation any
other new or successor trade
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name, logo, trademark or service xxxx which evolves as a result of the recent
merger between Price Waterhouse LLP and Coopers & Xxxxxxx LLP (together, the
"New Marks"), in connection with the marketing, promotion, Publicity and sale of
the C1 Software. Notwithstanding any other provision contained herein or in any
guidelines established by MDC, in the event that C1 gives PwC notice that it is
terminating this Agreement pursuant to Section 11.3.2, PwC shall immediately
cease, and in the event the Agreement is terminated for any other reason, upon
termination PwC shall cease, the use of the name "Commerce One," the xxxx "C1",
any derivations thereof or any other xxxx proprietary to C1.
3.8 MARKETING MATERIALS. In addition to any other guidelines set forth
by the MDC, (i) all C1 created brochures and marketing materials relating to the
C1 Software shall contain a statement that C1 and PwC are strategically aligned
and that PwC is a preferred systems integration and consulting partner, and (ii)
all references to third party integration and consulting partners shall be made
in such a manner as to preserve the preferred implementor status of PwC. MCI
Systemshouse shall be the only other entity designated or allowed to hold itself
out as a preferred systems integrator and consulting partner of C1.
4. BETA PRODUCTS; BETA INTEGRATION SITES
4.1 BETA PRODUCTS. C1 shall provide to PwC advance copies and beta
releases of all C1 Software as soon as reasonably possible.
4.2 BETA INTEGRATION SITES. The MDC will agree upon not less than five
customers to serve as beta integration sites with respect to the C1 Software.
PwC shall perform the implementation functions relative to such C1 Software at
such beta integration sites. [*]. C1 will use reasonable commercial efforts to
license the C1 Software at a price necessary to attract the agreed upon
customers to participate in such integration and will supply necessary technical
expertise and support with respect to the beta integration site implementations
under a mutually agreed upon timetable.
5. C1 SOFTWARE SALES
5.1 C1 SOFTWARE SALES. C1 may, at its option, sell C1 Software either
directly to clients or sell it to PwC who will resell it to clients; provided
that, direct sales to clients will comply with the provisions set forth in
Section 5.1.1 below and sales to PwC for resale will comply with the
provisions set forth in Section 5.1.2 below.
5.1.1 DIRECT SALES TO CLIENTS. When C1 sells C1 Software directly
to a client and PwC is to be the implementor of the C1 Software, the client, C1
and PwC will enter into a client contract. The client contract will provide
that:
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(a) C1 will provide to the client the C1 Software and
related license.
(b) PwC will provide to the client:
(i) assistance and/or management in the installation,
implementation and operation of C1 Software, including without limitation,
requirements definition, change integration, process analysis and design;
(ii) assistance in integrating C1 Software into the
client's existing systems; and
(iii) training for client personnel in the use or
maintenance of C1 Software ((i), (ii) and (iii) together are "C1 Installation
and Related Services").
(c) In exchange for the consideration set forth in
sections (a) and (b) above, the client will pay C1 and PwC such fees as may be
agreed upon from time to time.
(d) C1 will supply to the client any Upgrades to C1
Software under C1's standard maintenance and support terms.
5.1.2 SALES TO PwC FOR RESALE TO CLIENT. The sale of C1
Software to PwC and PwC's resale of C1 Software shall occur as follows:
(a) C1 will provide to PwC the C1 Software and related
license. PwC will provide said software and related license to the client.
(b) PwC will provide to the client C1 Software
Installation and Related Services.
(c) In exchange for the C1 Software and related license,
PwC will pay to C1 an amount equal to C1's standard list price for such C1
Software, less an agreed upon discount which shall not be less than any other
reseller's discount, [*]. PwC may charge the client such amounts as PwC may
determine in its sole discretion in exchange for the C1 Software and related
license and the C1 Software Installation and Related Services.
(d) C1 will supply to PwC any Upgrades to C1 Software
under the terms and conditions for its so doing set forth in the definitive
reseller agreement described in section (e) below. PwC will supply these
Upgrades to the client under the terms and conditions for its so doing set forth
in the PwC's agreement with its customer.
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(e) Within a reasonable time following the conclusion of
the beta integration projects, PwC and C1 shall enter into a more detailed Value
Added Reseller Agreement consistent with the terms hereof and containing other
mutually acceptable terms customary for the software industry. Such agreement
shall not diminish C1's ability to communicate with and survey the licensees of
the C1 Software. Such agreement will also provide that C1 will always execute a
license agreement with the end-user for C1 Software.
6. PREFERRED IMPLEMENTOR STATUS
6.1 PwC AND MCI SYSTEMSHOUSE. PwC shall be designated as a preferred
implementor or preferred systems integration and consulting affiliate with
respect to the C1 Software. C1 shall neither name nor allow any other entity to
promote itself as a preferred implementor or preferred systems integration and
consulting partner of C1, except for MCI Systemshouse; provided, however, in the
event that MCI Systemshouse terminates its status as a preferred implementor or
preferred systems integration and consulting partner of C1, C1 shall have the
right to designate another entity to replace MCI Systemshouse as a preferred
implementor or preferred systems integration and consulting partner provided,
further, however, the Parties agree that any such replacement entity shall not
be [*] and any such replacement entity shall be required to make an investment
in C1 equal to or greater than the cumulative total investment in C1 made by PwC
up to such time pursuant to this Agreement. In the event C1 designates such a
replacement entity as provided in this Section 6.1 any provisions herein which
specifically reference MCI Systemshouse shall apply to such replacement entity.
6.2 PROMOTION OF PARTIES. In furtherance of the Parties' joint efforts
with respect to the C1 Software:
(a) C1 shall publicly designate PwC as a C1 preferred
systems integration and consulting affiliate;
(b) C1 shall notify PwC of all potential implementation
opportunities with respect to the C1 Software of which C1 becomes aware, except
for those opportunities which are brought to the attention of C1 by another
systems implementor;
(c) C1 shall provide to PwC, on a timely, periodic and
confidential basis, advance information collected by C1 regarding potential
customer prospects with respect to the C1 Software;
(d) C1 shall not engage in any active pattern of
promotion with respect to any third party, other than MCI Systemshouse, as an
implementor of the C1 Software;
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(e) For one year following the execution of this
Agreement, C1 shall not enter into any joint development agreement or any
similar business arrangement related to the development of the C1 Software with
any other systems implementor other than MCI Systemshouse with respect to
MarketSite, Electronic Commerce Network, the Commerce One extranet application
that provides the interoperability, functionality and transactive content that
enables an on-line trading community;
(f) [*];
(g) [*];
(h) PwC shall notify C1 of all MRO (indirect) electronic
procurement solution opportunities of which PwC's EPS Practice becomes aware,
except for those opportunities which are brought to the attention of PwC by
another MRO (indirect) electronic procurement solutions provider;
(i) PwC shall provide to C1, on a timely, periodic and
confidential basis, advance information collected by PwC's EPS Practice
regarding potential customer prospects with respect to an MRO (indirect)
electronic procurement solution;
(j) PwC's EPS Practice shall not engage in any active
pattern of promotion with respect to any third party as an MRO (indirect)
electronic procurement solution provider; and
(k) Within 120 days following the execution of this
Agreement, C1 shall be included in PwC's solution center network.
6.3 RIGHT OF FIRST REFUSAL. PwC shall have a right of first refusal
with respect to other consulting and systems implementation firms with respect
to any consulting project of total value greater than $500,000 (i.e. the total
billable work for such project exceeds $500,000) performed for C1 in relation to
the C1 Software; provided that this section 6.3 shall not apply to any joint
development agreement entered into by C1 that otherwise complies with the terms
of this Agreement. This right of first refusal is not intended to apply to
consulting work to be performed for clients of C1. Within 20 days following a
determination by C1 that C1 requires consulting services, C1 shall notify PwC of
such determination and C1 and PwC shall negotiate in good faith regarding the
terms of PwC's involvement in the consulting project (the "Project"). If C1 and
PwC cannot agree upon the terms of PwC's involvement within 30 days of PwC's
receipt of such notice, C1 shall be entitled to enter into an agreement with a
third party to perform the Project on terms and conditions not less favorable to
C1 than those last offered by PwC with respect thereto.
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6.4 ATTENDANCE AT BOARD MEETINGS. Throughout the term of this
Agreement, PwC shall be entitled to observe meetings called or held by the Board
of Directors of C1 and to receive materials provided or distributed to the Board
of Directors of C1 as provided in the Observers Rights Agreement attached hereto
as Exhibit B.
6.5 Requirements FOR OTHER SYSTEMS IMPLEMENTORS. C1 shall require each
third party systems implementor, other than MCI Systemshouse, to pass a
certification qualification test within six (6) months of beginning
implementation of C1 Software products. The requirements of such certification
tests shall be jointly agreed upon by C1 and PwC and shall be administered by
C1; provided that in the event the Parties are unable to agree on such
requirements after a period of twenty (20) days, C1 shall develop commercially
reasonable requirements.
6.6 MOST FAVORED IMPLEMENTOR STATUS. Except for SAP but subject to
Section 5.1.2(c), the price of the C1 Software sold by C1 to PwC for resale or
for use by PwC shall be equal to or lower than the lowest price charged by C1 to
any other systems implementor reseller, including MCI Systemshouse with regard
to the prices and other material terms and conditions provided to such other
implementor, when considered collectively.
6.7 OPTIONAL EQUITY INVESTMENT. For 120 days following the execution of
this Agreement, PwC shall have the option, but not the obligation, to purchase
shares of Series D Preferred Stock at a price equal to 125% of the lowest price
paid by the Series D Preferred Stock investors in the Series D Preferred Stock
financing. Such purchase shall be on the terms and conditions as set forth in
the Series D Preferred Stock financing agreements. Notwithstanding the
foregoing, in no event shall PwC's investment be less than $2,500,000 or more
than $5,000,000 upon exercise of the rights granted in this Section.
7. PERSONNEL AND TRAINING
7.1 PwC PERSONNEL. For the first year after the Effective Date of this
Agreement and pursuant to and subject to the terms and conditions set forth in
the Human Resources Agreement to be agreed upon and entered into by the Parties
within 30 days of the date hereof (the "Human Resources Agreement"), PwC shall
provide C1 with a total of [*] man-hours to be performed by various PwC
personnel and/or consultants of PwC (the "PwC Staff") and one partially
dedicated PwC partner (the "PwC Partner") plus certain ancillary support
associated with the employment of these people, including, without limitation,
items such as payment of salaries (including without limitation, employee
benefits and applicable withholding taxes, such as FICA, worker's compensation,
unemployment and other like items) and provision of laptop computers and
computer software (the "Support"). In the event that C1 does not utilize all [*]
hours during such year and this Agreement is still in effect, C1 shall be
entitled to carry over up to [*] unused hours to the next year
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for no additional cost. PwC and C1 shall determine in good faith the amount of
resources required from time to time based upon the needs of C1 and the
availability of the PwC Staff; provided, however, no PwC Human Resources (as
defined below) shall be provided to C1 until such time as the Human Resources
Agreement has been executed by the Parties. The PwC Partner shall devote a
sufficient amount of his/her professional time in order for him/her to carry out
his/her responsibilities under this Agreement. The PwC Staff and the PwC Partner
shall be responsible for assisting C1 with product enhancement, quality
assurance, testing procurement consulting and sales support and implementation
activities. Subject to the terms of the Human Resources Agreement, PwC shall
have the right to rotate various people between the C1 headquarters in Walnut
Creek, California (the "C1 Headquarters") and various client sites.
Notwithstanding the foregoing, PwC's obligation to provide the [*] hours, the
PwC Partner and the Support (collectively, the "PwC Human Resources") shall
cease (i) immediately in the event (a) C1 is dissolved or liquidated, (b) PwC
gives C1 notice of its intention to terminate the Agreement pursuant to Section
11.3.2, or (c)the Human Resources Agreement is terminated, or (ii) upon
termination, in the event PwC gives C1 75 days' written notice (the "Termination
Notice") of PwC's decision to terminate this Agreement pursuant to Section
11.3.1; provided, however, in the event that PwC gives C1 the Termination
Notice, PwC shall continue to provide the PwC Human Resources during the 75 day
notice period as is necessary in order to complete, to the extent possible, any
current projects on which the PwC Staff and/or the PwC Partner are working.
7.2 TRAINING. During the first 12 months of the Agreement, PwC shall
commit to train a minimum of 25 PwC personnel to perform PwC's obligations
hereunder (including both sales-related, and Services-related obligations). Such
training shall be provided by C1 as part of the complimentary training provided
in accordance with details below, or at PwC's discretion, by a PwC trainer.
On a schedule reasonably acceptable to both parties, C1 will provide up
to three training days per trainee per calendar year during each year of the
term of the Agreement for no more than 100 trainees in the marketing, sale,
support, use, implementation and operation of the C1 Software. For purposes of
this calculation, a "training day" shall refer to one calendar day of
instruction provided by a C1 instructor for one PwC trainee. A training day
could take place as either structured classroom training or on-site at a client
location. The parties intend to execute a training strategy whereby C1 is
"training the trainers" at PwC. At PwC's option, PwC may purchase additional
training days from C1, in advance, for a reduced fee as follows: (i) for
purchases of 1-299 training days, a discount of 33% off of the then current list
price will apply, (ii) for purchases of greater the 300 training days, a
discount of 40% off of the then current list price will apply. Training priced
under this discount must be purchased at least thirty (30) days in advance. Any
training days purchased but not utilized or any free training days (i.e., the 3
days provided at no charge to PwC for 100 trainees) remaining unused at the end
of the each year will expire. C1 will send to PwC a
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quarterly report on the status/balance of such unused training days. PwC when
ordering training to be applied against the purchased training credit amount
shall quote a reference number from the applicable purchase order to ensure
credit against the prepaid training day balance. The Parties shall agree on a
mutually acceptable cancellation policy for scheduled training classes. It is
understood that all C1 technical training shall be provided at C1's Walnut
Creek, California facilities, at no cost to PwC, and sales training will be
provided at PwC regional offices or other similar facilities which will be made
available by PwC and PwC shall pay the out-of-pocket cost of travel plus lodging
of the C1 representative performing the training.
C1 shall provide to PwC sufficient copies of C1 Software and related
materials as shall be reasonably required for the training of the PwC personnel;
provided that such copies shall be used by PwC solely for internal training
purposes. C1 shall be entitled to receive adequate training by PwC on PwC's full
value procurement system for up to 20 training days per calendar year, at no
cost to C1 if such training takes place at one of PwC's offices as designated by
PwC, or for the out-of-pocket cost of travel plus lodging of the PwC
representative performing the training, if such training is performed at a C1
office or another location designated by C1.
7.3 PWC SERVICES FEE. In consideration of PwC supplying the PwC Human
Resources, after the parties have entered into the Human Resources Agreement,
PwC shall be entitled to receive a fee equal to [*]. In the event the
relationship between license fees, revenues and other revenues received by C1
from its licensees (i.e., consulting fees, maintenance fees and support fees)
differs materially from C1's business plan as it exists on the date hereof and
as disclosed to PwC, the parties shall negotiate the fees due under this Section
7.3 in good faith. For purposes of this Section 7.3, "license fee revenues"
shall mean license fees, to the extent received in cash by C1, net of
withholding taxes and other deductions, from customers; provided that it is
understood and agreed that "license fee revenues" shall not include any amounts
received by C1 for maintenance and support services, consulting or professional
service fees, any transaction fees or any other amount or payment for goods or
services not expressly included within the definition of "license fee revenues"
set forth above. Such fee shall be paid quarterly in arrears; provided, however,
in the event that this Agreement is terminated by C1 or by PwC pursuant to
section 11.3.2 below, or there is a Change of Control of C1, prior to PwC being
paid the full [*] under this Section 7.3, PwC shall be entitled to be paid [*].
In the event that there is a Change in Control of C1, all remaining
amounts due to PwC under this Section 7.3 shall become immediately due and
payable to PwC regardless of the amount of C1's license fee revenues on that
date.
For purposes of this Agreement, a Change in Control shall mean the
occurrence of one or more of the following events:
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(a) the direct or indirect sale, lease, exchange or other
transfer of all or substantially all of the assets of an entity to any person or
entity or group of persons or entities acting in concert as a partnership or
other group (a "Group of Persons");
(b) the consummation of any consolidation or merger of an
entity with or into another corporation with the effect that the stockholders of
such entity immediately prior to the date of the consolidation or merger hold
immediately after such merger or consolidation less than 51% of the combined
voting power of the outstanding voting securities of the surviving entity of
such merger, or the corporation resulting from such consolidation, ordinarily
having the right to vote in the election of directors (apart from rights
accruing under special circumstances) immediately after such merger or
consolidation;
(c) the stockholders of an entity shall approve any plan or
proposal for the liquidation or dissolution of such entity;
(d) a person or entity or Group of Persons acting in concert
as a partnership, limited partnership, syndicate or other group shall, as a
result of a tender or exchange offer, open market purchases, privately
negotiated purchases or otherwise, have become the direct or indirect beneficial
owner (within the meaning of Rule 13d-3 under the Exchange Act of 1934, as
amended) of securities of an entity representing 30% or more of the combined
voting power of the then outstanding securities of such entity ordinarily (and
apart from rights accruing under special circumstances) having the right to vote
in the election of the directors; and
(e) a person or entity or Group of Persons, together with any
affiliates thereof, shall succeed in having a sufficient number of its nominees
elected to the Board of Directors of an entity such that such nominees, when
added to any existing directors remaining on the Board of Directors of such
entity after such election who are affiliates of such person, entity or Group of
Persons, will constitute a majority of the Board of Directors of such entity.
8. CONFIDENTIALITY; INTELLECTUAL PROPERTY
8.1 CONFIDENTIALITY GENERALLY. During the term of this Agreement and
for a period of three (3) years from the termination of this Agreement (and for
a period of ten (10) years from the termination of this Agreement in the case of
source code), each Party hereto shall take all reasonable steps which are
necessary or reasonable to safeguard the secrecy and confidentiality of, and
proprietary rights to, the Confidential Information disclosed or provided by the
other Party, and shall not disclose the foregoing to any third party (other than
any employee, agent, director, officer, consultant or contractor and on a "need
to know" basis under suitable agreements of confidentiality with such parties)
or use the same for purposes other than those set forth herein.
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8.1.1 Each Party shall make no use whatsoever, directly or indirectly,
of any Confidential Information of the other Party, except as required in
connection with the performance of its obligations under this Agreement and in
accordance with its terms.
8.1.2 Upon either Party's request at any time and for any reason, the
other Party shall immediately deliver to the Party so requesting all materials
(including all copies) in its possession which contain Confidential Information
of that Party.
8.2 CONFIDENTIALITY WITH RESPECT TO THE TRC AND THE MDC. Confidential
Information of a Party may be (and in certain circumstances must be) disclosed
by the Party to the TRC or the MDC. The employees designated as members of the
TRC and the MDC may share with their employers any and all information,
including Confidential Information, disclosed to the TRC or the MDC; provided,
however, that the requirements regarding Confidential Information set forth in
Section 8.1 above will be observed by the members of the TRC and the MDC, the
Parties and their employees with respect to Confidential Information disclosed
by either Party to the TRC or the MDC.
8.3 INTELLECTUAL PROPERTY. All inventions, development, improvements,
patents, patent applications, trade secrets, processes, concepts, uses, know
how, software applications, designs, works of authorship, algorithms, lists,
marketing and business plans and other work product and intellectual property
(collectively, "Intellectual Property") relating to C1 Software shall be the
sole property of C1. . At any time or from time to time on and after the date of
this Agreement, PwC shall at the request of C1 (i) deliver to C1 such records,
data or other documents consistent with the provisions of this Agreement, and
(ii) execute, and deliver or cause to be delivered, all such assignments,
consents, documents or further instruments of transfer or license, and (iii)
take or cause to be taken all such other actions, as C1 may reasonably deem
necessary or desirable in order for C1 to obtain the full benefits of this
Agreement and the transactions contemplated hereby. C1 shall, for any
Intellectual Property relating to C1 Software owned by it and not by PwC provide
to PwC a temporary, limited, non-exclusive, non-transferable license
co-extensive with the term of this Agreement to use any and all such
Intellectual Property solely for the purposes set forth in this Agreement (i.e.,
demonstration, internal training and support purposes).
8.4 DATA COLLECTION. C1 and PwC may each compile for its own use and
purposes, and shall have exclusive use and ownership of, any captured cost data
or other information. Any such statistical data or information compiled by
either C1 or PwC shall be its sole property, and it may use, sell or distribute
such data or information for any purposes not prohibited by this Agreement or
any other agreement.
8.5 LICENSE. Following the execution of this Agreement, PwC, on behalf
of PwC's Business Process Outsourcing service line and C1 shall negotiate in
good faith regarding a license to
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the C1 Software for the purpose of allowing PwC to provide Business Process
Outsourcing services. PwC's Business Process Outsourcing service line is not
bound to choose Commerce One as its preferred solution by virtue of the
preceding language.
9. REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION BY PwC
9.1 PwC REPRESENTATIONS AND WARRANTIES. PwC hereby represents and
warrants to C1 as follows:
(a) any C1 Software Installation and Related Services
performed by PwC shall be performed in a workmanlike and competent manner.
(b) PwC has full right, power, and authority to enter into
this Agreement and to carry out its obligations hereunder.
9.2 INDEMNIFICATION. Subject to the provisions of Section 9.3 below,
PwC shall indemnify C1, its employees, agents, officers, shareholders, directors
and affiliates for, defend and hold C1 harmless from and against, any costs
(including attorneys' fees) or damages finally awarded against C1 and payable to
a third party that are attributable to
(a) any breach of the warranties set forth in 9.1; and
(b) any claims by third parties for death, personal injury or
damages resulting from the wrongful acts or negligence of PwC or its employees,
agents, officers or directors.
(c) C1 shall give PwC prompt written notice of any such claim
or liability, and allow PwC to control the defense of such claim and all related
settlement negotiations and fully cooperate with PwC in such defense and
negotiations at PwC's expense. In the event that C1 wishes to participate in the
defense of any such claim, C1 shall be entitled to participate at C1's own
expense.
10. REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION BY C1
10.1 C1 REPRESENTATIONS AND WARRANTIES. C1 hereby represents and
warrants to PwC as follows:
C1 has full right, power and authority to enter into this Agreement and
to carry out its obligations hereunder, and the execution of the terms hereof do
not violate any other agreement to which C1 is a party.
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10.2 INDEMNIFICATION BY C1. Subject to the provisions of Section 10.3
below, C1 shall indemnify PwC and the PwC Affiliates for, defend and hold each
of them harmless from and against, any costs (including attorneys' fees) or
damages finally awarded against PwC and/or the PwC Affiliates and payable to a
third party that are attributable to
(a) any breach of the warranties set forth in Section 10.1
above; and
(b) arising out of claims by third parties for death, personal
injury or damages resulting from the wrongful acts or negligence of C1 or its
employees, agents, officers or directors.
PwC and/or the PwC Affiliates, as applicable, shall give C1 prompt
written notice of any such claim or liability, and allow C1 to control the
defense of such claim and all related settlement negotiations and fully
cooperate with C1 in such defense and negotiations. In the event that PwC and/or
the PwC Affiliates wish to participate in the defense of any cash claim, C1 may
allow PwC and/or the PwC Affiliates to participate at PwC's and/or the PwC
Affiliates' own expense.
10.3 THIRD PARTY INFRINGEMENT.
(a) INDEMNITY. C1 shall indemnify PwC and PwC Affiliates for,
defend and hold each of them harmless from and against, any costs (including
attorney's fees) or damages arising from any claim that the C1 Software
infringes a copyright, United States patent or Trade Secret and shall pay any
settlements entered into or damages awarded against PwC and the PwC Affiliates
to the extent based on such a claim, provided that (i) PwC and/or the PwC
Affiliates, as applicable, notifies C1 promptly in writing of the claim; (ii) C1
has sole control of the defense and all related settlement negotiations; and
(iii) PwC and/or the PwC Affiliates, as applicable, provides C1 with all
necessary assistance, information, and authority to perform the above, at C1's
sole cost and expense.
(b) EXCLUSIONS. C1 shall have no liability for any claim of
infringement based on (i) PwC's use of other than the latest release of the C1
Software if the infringement would have been avoided by use of the latest
release; (ii) PwC's modification of the C1 Software if the infringement would
have been avoided without such modification; or (iii) the combination or use of
the C1 Software furnished hereunder by PwC with materials not furnished by C1 if
such infringement would have been avoided by use of the C1 materials alone.
(c) ALTERNATIVES. In the event the C1 Software licensed to PwC
hereunder is held to, or C1 believes is likely to be held to, infringe a
copyright, trade secret or patent C1 shall have the right at its sole option and
expense to (i) substitute or modify the C1 Software license to PwC hereunder so
that it is noninfringing; or (ii) obtain for PwC a license to continue using the
C1
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Software as provided in this Agreement; or (iii) if (i) and (ii) are not
reasonably practicable, terminate the license granted to PwC pursuant to the
last sentence of Section 8.3 hereof.
(d) The foregoing states the sole obligation and exclusive
liability of C1 (express, implied, statutory or otherwise) for any infringement
on claims or claims of infringement of any patent, copyright or trade secret by
reason of PwC's use of the C1 Software pursuant to the last sentence of Section
8.3 hereof.
10.4 INSURANCE. C1 shall maintain in full force and effect at all times
the insurance specified in Exhibit A in the minimum amounts set forth and shall
name PwC as an additional named insured. PwC represents and warrants that it is
self insured in amounts satisfactory to PwC to cover its contractual obligations
hereunder.
11. EFFECTIVE DATE, TERM AND TERMINATION
11.1 EFFECTIVE DATE. This Agreement shall become effective (the
"Effective Date") as of the date hereof.
11.2 TERM. Unless terminated earlier as provided in this Agreement,
this Agreement shall be for an initial term of (i) three years if PwC does
not make an equity investment in C1, or (ii) five years if PwC makes an
equity investment in C1 as provided in Section 6.6, and thereafter will
continue until either party gives at least 90 days' written notice of
termination.
11.3 TERMINATION.
11.3.1 WITHOUT CAUSE. PwC may terminate this Agreement upon 75 days'
written notice to C1.
11.3.2 WITH CAUSE.
(a) C1 may terminate this Agreement for material breach by PwC
upon 30 days' written notice to PwC if said breach is not cured by PwC within
such period. PwC may terminate this Agreement for material breach by C1 upon 30
days' written notice to C1 if said breach is not cured by C1 within such period.
(b) Either party may terminate this Agreement effective
immediately if the Parties are not able to negotiate in good faith and execute
the Human Resources Agreement and the Marketing Plan within 30 days following
the execution of this Agreement, unless otherwise agreed by the Parties.
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(c) Finally, either Party may terminate this Agreement
effective immediately upon written notice to the other, if at any time the other
Party:
(i) files a voluntary petition for bankruptcy;
(ii) is adjudged a bankrupt;
(iii) has a trustee or receiver is appointed by a
court for all or a substantial portion of its respective assets;
(iv) has a court assume jurisdiction of its assets
under a reorganization act;
(v) suspends business;
(vi) makes an assignment of its assets for the
benefit of creditors; or
(vii) enters into a composition for the benefit of
creditors.
11.4 EFFECT OF TERMINATION.
11.4.1 Unless the Parties agree to the contrary, the termination of
this Agreement for any reason shall not relieve a Party of its obligations:
(a) to make payments hereunder which have accrued prior to
termination; and
(b) to complete its obligations to clients or relating to
obligations for clients existing at the termination date pursuant to Sections
5.1 and 5.2.
11.4.2 SURVIVAL. In addition, the following Sections shall survive
termination or expiration of this Agreement: 1, 8.1, 8.2, 8.3,
8.4, 9, 10, 11.4, 12 and 13.
11.4.3 TERMINATION OF HUMAN RESOURCES AGREEMENT. In the event that
PwC provides notice to C1 that it is terminating this Agreement pursuant to
Section 11.3.1, PwC shall be entitled to terminate the Human Resources Agreement
upon 75 days' written notice to C1. In the event that PwC provides notice to C1
that it is terminating this Agreement pursuant to Section 11.3.2, PwC shall be
entitled to terminate the Human Resources Agreement and cease its provision of
the Human Resources immediately.
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GENERAL PROVISIONS
12.1 HEADINGS. The headings in this Agreement and Exhibits are provided
for reference only and shall not be used as a guide to interpretation.
12.2 SEVERABILITY. If any provision of this Agreement shall be
adjudicated to be invalid or unenforceable, the Agreement shall be amended to
delete such provision and the Agreement shall otherwise remain in full force and
effect as amended unless such amended Agreement does not reflect the purposes of
the Parties in entering into the Agreement.
12.3 AUTHORITY OF PARTIES. Neither Party shall have any authority,
express or implied, to assume or create any obligation on behalf of the other
Party..
12.4 PARTIES INDEPENDENT. In making and performing this Agreement the
parties act and shall act at all times as independent contractors and nothing
contained in this Agreement shall be construed or implied to create an agency,
partnership or employee/employer relationship between C1 and PwC or between any
Party hereto and any officer or employee of the other Party. Each Party shall be
responsible for the acts, negligence and omissions of its employees, agents
servants and subcontractors. Each Party accepts full and exclusive liability
with respect to its own employees for the payment of any and all contributions
and taxes imposed by local, state or federal law, including but not limited to
taxes or contributions for social security, unemployment insurance, worker's
compensation, old age retirement benefits, pensions and annuities, and agrees to
provide indemnity for any such payment made by the other Party.
12.5 ASSIGNMENT. This Agreement shall be binding on and inure to the
benefit of the Parties and their respective successors and assigns, PROVIDED
THAT neither PwC nor C1 may assign its rights or obligations hereunder to any
party which is not controlled by or under common control with the assigning
party without the prior written consent of the other Party.
12.6 ARBITRATION. Any controversy or claim arising out of or relating
to this Agreement may be submitted to arbitration by either party hereto in
accordance with the rules of the American Arbitration Association for Commercial
Arbitration, and judgment upon the award rendered by the arbitrators may be
entered in any court having proper jurisdiction. The Parties to any such
arbitration shall share equally the cost of the arbitrators, but shall each bear
its own legal, accounting and similar fees and expenses; provided, however, that
the arbitrators shall require the Party or Parties, if any, not prevailing in
such arbitration to pay all costs of the arbitrators and to reimburse the
prevailing Party or Parties, if any, for their legal, accounting and other
similar fees and expenses in connection with the arbitration. Such arbitration
and determination shall be final and binding on the parties. Such arbitration
shall be held in San Francisco, California or such other location as the parties
may agree.
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12.7 ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the Exhibits
attached hereto contain the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements or
understandings between the parties hereto with respect thereto. This Agreement
may be amended only by an agreement in writing signed by the parties hereto.
12.8 NOTICES. Any notice required or permitted to be given pursuant to
this Agreement shall be in writing and shall be personally delivered, delivered
by next-day air courier, or mailed (by registered or certified mail, return
receipt requested and postage prepaid) or delivered by facsimile as follows:
IF TO C1:
Xxxxx Xxxxxxxx
V.P. Marketing
Commerce One
0000 Xxxxxxx Xxx.
Xxxxx 000
Xxxxxx Xxxxx XX
Phone: 000-000-0000
Fax: 000-000-0000
IF TO PRICE WATERHOUSE
Xxxxxx Xxxxx
PricewaterhouseCoopers LLP
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xx. Xxxxx, XX 00000
Fax: (000) 000-0000
WITH A COPY TO
Office of the General Counsel
PricewaterhouseCoopers LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: 000-000-0000
or to such other addresses as the Party to whom notice is given may have
furnished to the other Party in writing, in accordance herewith. Any
communication shall be deemed to have been given, in the case of personal
delivery or confirmed facsimile, on the date of delivery; in the case of
delivery of air
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courier, on the business day after delivery to the applicable air-courier
service; and in the case of mailing, on the third business day following the day
on which the piece of mail containing such communication is posted.
12.9 WAIVER. No terms or provisions hereof shall be deemed waived and
no breach consented to or excused, unless such waiver, excuse or consent shall
be in writing and signed by the Party claimed to have waived or consented. The
consent, waiver or excuse by either party of a breach of any provision of this
Agreement by the other party shall not operate or be construed as a waiver of
any subsequent breach by such other Party.
12.10 GOVERNING LAW. This Agreement shall be governed by, and construed
and enforced in accordance with the laws of the State of New York, excluding its
conflicts of laws rules.
12.11 FORCE MAJEURE. Neither Party shall be liable or deemed to be in
default for any delay or failure to perform under this Agreement or for
interruption in the functions of the proprietary products or services resulting,
directly or indirectly, from any cause beyond such Party's reasonable control.
13. LIMITATION OF LIABILITY
EXCEPT AS EXPRESSLY SET FORTH ABOVE, NEITHER PARTY MAKES ANY
REPRESENTATIONS OR WARRANTIES TO THE OTHER PARTY WITH RESPECT TO ANY SERVICES OR
MATERIALS PROVIDED UNDER THIS AGREEMENT, EXPRESS, IMPLIED, STATUTORY OR
OTHERWISE, INCLUDING BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, SATISFACTORY QUALITY OR
NONINFRINGEMENT OR ANY IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE WITH RESPECT TO SUCH ITEMS. EXCEPT FOR (A) INFRINGEMENT OF
THE OTHER PARTY'S INTELLECTUAL PROPERTY RIGHTS, (B) A MATERIAL BREACH OF SECTION
8, OR (C) A BREACH OF SECTION 6, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR
ANY SPECIAL, CONSEQUENTIAL, INDIRECT, OR INCIDENTAL DAMAGES ARISING OUT OF OR
RELATED TO THIS AGREEMENT, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY AND
WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OR IS AWARE OF THE POSSIBILITY OF
SUCH DAMAGES. IN THE EVENT OF A BREACH BY C1 OF ITS OBLIGATIONS UNDER SECTION 6,
C1'S LIABILITY TO PwC BY REASON OF SUCH BREACH SHALL IN NO EVENT EXCEED $3.5
MILLION.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the
authorized officers of the respective parties as of the day and year first above
written.
COMMERCE ONE, INC. PRICEWATERHOUSECOOPERS LLP
By: By:
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Title: Title:
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Date: Date:
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