Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Exhibit 10.8
------------
Addendum to XXX Xxxxxxxxxxx
---------------------------
Value Added Systems Integrator Agreement
----------------------------------------
1. Background/Introduction
This Addendum dated February 2, 2000 shall be considered an Addendum to the
Valued Added Systems Integrator Agreement (the "Agreement") between XXX
Xxxxxxxxxxx ("EMC") and StorageNetworks, Inc. ("SNI") dated as of September
15, 1999 (the "VASI"). This Addendum and the Agreement shall be construed
together. However, to the extent that this Addendum conflicts with the
Agreement, this Addendum shall govern.
2. Pricing Strategy - Volume Purchase Levels
. Annual Purchase Commitment: The pricing set forth below provides an
immediate discount structure based on [**] year 2000 annual
commitment.
. Quarterly Commitment Levels: To receive this discounted pricing
structure - SNI agrees that it shall purchase [**] of EMC Products
direct from EMC during the following calendar quarters in year 2000:
Q/1 [**] [**]
Q/2 [**] [**]
Q/3 [**] [**]
Q/4 [**] [**]
Total 2000 Annual [**]
SNI agrees that [**]or [**]of the [**] shall be comprised of purchases of EMC
software products. Each purchase by SNI of [**] of EMC products shall consist
of at least [**]of EMC software products. Each [**] purchase in excess of
[**]shall also consist of at least [**] of EMC software products.
. Technology Configuration, Costs, Terms and Conditions: All discounts
throughout YEAR 2000 are based on EMC's list price as of 12/31/99.
Should EMC reduce its list-pricing , SNI will receive the following
discount structures off the reduced pricing schedule.
[**] MINIMUM FULL FRAME (TOTAL DISKS) with Standard Configuration*
-------------------------------------------------------------
3930 Frame (Total disks - [**]) $/MB[**]Full)
---- -----
[**] Discount on FRAME, CONNECTIVITY, CACHE [**]MB
[**] Discount on DISK
[**] Discount on SOFTWARE [**]MB
NOTE: Less than [**] full frame, pricing will be [**]MB
individually based, but revenue will count towards volume commitments ($)
3830 Frame (Total disks - [**]) $/MB [**]Full)
----- -----
[**] Discount on FRAME, CONNECTIVITY, CACHE [**]MB
[**] Discount on DISK
[**] Discount on SOFTWARE [**]MB
NOTE: Less than [**] full frame, pricing will be [**]MB
individually based, but revenue will count towards volume commitments ($)
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*Standard Symmetrix Configuration (Software): ALL 3830 / 3930 FRAMES CAN BE
CONFIGURED WITH THE FOLLOWING SOFTWARE PRODUCTS:
-(1) SYMMETRIX CONTROL CENTER PACKAGE
-(1) TIMEFINDER OPEN
AND EITHER
-(2) POWERPATH LICENSES (ENTERPRISE UNIX) OR,
-(3) POWERPATH LICENSES (ENTERPRISE NT)
NOTE: ADDITIONAL SOFTWARE PRODUCTS WILL AFFECT THE SW COSTS PER MB.
. ANY EMC SOFTWARE REQUIRED BEYOND THE ABOVE LICENSES WILL BE ENTITLED
TO THE APPROPRIATE DISCOUNT STRUCTURE
Additional Hardware Components
CELERRA (MINIMUM CONFIGURATION)
-------------------------------
.(1) CFS 14 Celerra Cabinet [**]Discount on Celerra Hardware
.(4) Data Movers
.(1) Control Station
.(8) 12mini68S cables
.(4) NFS Data Mover License [**]Discount on Celerra Software
.(1) Control Station Software
CONNECTRIX (MINIMUM CONFIGURATION)
----------------------------------
.(1) Connectrix Frame [**]Discount on Connectrix Hardware
.(1) Connectrix Service Proc Kit
.(1) 32 Port Director
.(1) Connectrix Mgr. License [**]Discount on Connectrix Software
.(1) Connectrix Product Mgr. License
HARDWARE UPGRADES (I.e. Individual purchases of Disk, Cache, Connectivity)
--------------------------------------------------------------------------
DISK UPGRADE: [**]MB [**] discount off Upgrade List Pricing
CACHE UPGRADE: [**] [**]discount off Upgrade List Pricing
CONNECTIVITY UPGRADES: [**] [**] discount off List Pricing
CELERRA HARDWARE UPGRADE: [**] [**] Discount off List Pricing
CONNECTRIX HARDWARE UPGRADE: [**] [**] Discount off List Pricing
3. Special Additional Terms and Discounts:
Software Site License Pricing:
SHOULD SNI PURCHASE MULTIPLE COPIES OF EMC SOFTWARE PRODUCTS FOR NEW OR
EXISTING SYMMETRIX LOCATIONS ON THE SAME ORDER, THE FOLLOWING DISCOUNT
STRUCTURE WILL APPLY.
VOLUME DISCOUNT
---------------
. 1 OR MORE COPIES OF ANY EMC SOFTWARE PRODUCT: [**]off list
. 1 - 3 COPIES OF ANY LIKE EMC SOFTWARE PRODUCT: [**] off list
. 4 OR MORE COPIES OF ANY LIKE EMC SOFTWARE PRODUCT: [**]off list
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Exchange Commission. Asterisks denote omissions.
. NOTE: ADDITIONAL DISCOUNTS DESCRIBED ABOVE REPLACE THOSE OUTLINED IN
THE MINIMUM CONFIGURATION FRAMEWORK AND WILL APPLY WHERE APPROPRIATE.
Software Maintenance:
TIERED ANNUAL DISCOUNT STRUCTURE WITH ADVANCE COMMITMENT
12 Month Commitment: [**] Discount off List Price on Software and
Hardware Maintenance Fees
24 Month Commitment: [**] Discount off List Price on Software and
Hardware Maintenance Fees
36 Month Commitment: [**] Discount off List Price on Software and
Hardware Maintenance Fees
Prepayment of any of the: [**] ADDITIONAL Discount off List price on
above tiered structure Software and Hardware Maintenance Fees
Hardware Maintenance:
WITH ADVANCE COMMITMENT TO 36 MONTH SOFTWARE MAINTENANCE: 24
MONTH HARDWARE WARRANTY PERIOD WILL BE EXTENDED TO 36 MONTHS.
. ADDITIONAL 12 MONTH COMMITMENTS BEYOND 36 MONTH WARRANTY AT [**] OFF
LIST
. ADDITIONAL [**] DISCOUNT FOR PREPAYMENT OF ANY ADDITIONAL 12 MONTH
COMMITMENT BEYOND 36 MONTH WARRANTY
. WITH A 36 MONTH SOFTWARE MAINTENANCE COMMITMENT ON PURCHASES MADE IN
PAST 90 DAYS, EMC WILL RETROACTIVELY HONOR THE ABOVE DISCOUNTS ON ANY
SOFTWARE MAINTENANCE INVOICES THAT HAVE NOT BEEN SENT TO SNI AS OF THE
DATE APPROVAL AND EXECUTION OF THIS ADDENDUM
General Terms and Conditions:
. ALL BASE FRAMES WILL INCLUDE EMC STANDARD REQUIRED CACHE AND MINIMUM
CONNECTIVITY CARDS AS OUTLINED IN THE STANDARD CONFIGURATION
DESCRIPTION
. ANY EMC HARDWARE OR SOFTWARE PRODUCT (INCLUDING DATA GENERAL AND
CLARION PRODUCTS) PURCHASED DIRECT FROM EMC WILL APPLY TO THE ANNUAL
REVENUE COMMITMENT
. TO RECEIVE THIS DISCOUNTED PRICING STRUCTURE - SNI AGREES THAT IT
SHALL PURCHASE [**] OF EMC PRODUCTS DIRECT FROM EMC DURING THE FOUR
CALENDAR QUARTERS IN 2000, IN INCREMENTS AS DEFINED ABOVE
. IN THE EVENT OF A QUARTERLY PURCHASE SHORTFALL OF [**] OR LESS(FROM
THE COMMITMENT, EMC AGREES TO ROLL THIS PURCHASE SHORTFALL INTO THE
FOLLOWING QUARTERLY COMMITMENT.
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. SHOULD THE SHORTFALL EXCEED [**] SNI AGREES THAT IT WILL PURCHASE A
SUFFICIENT AMOUNT OF EMC PRODUCT(S) IN ORDER TO FULFILL THE ORIGINAL
QUARTERLY COMMITMENT.
. ON A ONE TIME, ONE QUARTER BASIS, SNI WILL ALSO HAVE AT ITS OPTION,
THE ABILITY TO PURCHASE EQUIPMENT EQUALING ONLY THE DIFFERENCE BETWEEN
THE ACTUAL PURCHASES AND [**] AMOUNT OF THE QUARTER PURCHASE
COMMITMENT, AND ROLL THE REMAINING [**] INTO THE FOLLOWING QUARTER.
THIS OPTION IS AVAILABLE TO SNI FOR ONE QUARTER - Q/1, Q/2 OR Q/3 OF
2000.
. AT THE END OF FISCAL YEAR (Q/4 2000), SHOULD ACTUAL AMOUNT OF
EQUIPMENT PURCHASED BE LESS THAN [**] DOLLARS, SNI AGREES THAT IT WILL
PURCHASE A SUFFICIENT AMOUNT OF EMC PRODUCT(S) IN ORDER TO FULFILL THE
[**] DOLLAR ANNUAL COMMITMENT.
. FOR ALL PURCHASES IN EXCEES OF ANY QUARTERLY COMMITMENT,THE AMOUNT OF
SUCH PURCHASES WILL BE APPLIED AS A REDUCTION TOWARDS THE FOLLOWING
QUARTER'S REVENUE COMMITMENT AND WILL BE ELIGIBLE FOR THE APPLICATION
OF THE ACCELERATOR DISCOUNT OUTLINED BELOW.
Accelerator Discounting:
INCENTIVE DISCOUNT CLAUSE: IN THE EVENT SNI EXCEEDS A STATED QUARTERLY
PURCHASE COMMITMENT THE NEXT PURCHASE MADE BY SNI AND ANY FOLLOWING
----
PURCHASES MADE IN SAID QUARTER WILL ENTITLE SNI TO ADDITIONAL
INDEPENDENT DISCOUNTS (SEE BELOW) ON THE PURCHASE TOTAL FOR: (FRAME,
CONNECTIVITY AND CACHE), (DISK) AND (SOFTWARE).
[**] OFF DOLLAR VALUE OF FRAME, CONNECTIVITY, CACHE
[**] OFF DOLLAR VALUE OF DISK
[**] OFF DOLLAR VALUE OF SOFTWARE
EMC Current List Pricing Terms:
DURING THE TERM OF THIS ADDENDUM, EMC LIST PRICES WILL BE CAPPED ON
THE START DATE. IF THERE SHOULD BE ANY REDUCTIONS IN LIST PRICES
DURING THE TERM OF THE AGREEMENT, DISCOUNTING WILL BE APPLIED TO THE
PRICES IN EFFECT ON THE DATE OF THE SALE.
Consigned Inventory:
EMC WILL AGREE TO PROVIDE SNI WITH EMC TECHNOLOGY ON A CONSIGNMENT
BASIS WITHIN ANY CALENDAR QUARTER.
NOTE: SNI VPA PRICING ENCLOSED WILL APPLY TO CONSIGNMENT INVENTORY
TO ENSURE TIMELY DELIVERY, EMC MUST RECEIVE A PURCHASE ORDER FOR
CONSIGNMENT INVENTORY NO LATER THAN WEEK 10 OF PREVIOUS CALENDAR
QUARTER DELIVERY OF REQUIRED INVENTORY WILL TAKE PLACE IN THE FIRST
TWO WEEKS OF A GIVEN QUARTER.
FAILURE TO DELIVER CONSIGNED INVENTORY PRODUCT WITHIN FIRST TWO WEEKS (14
DAYS) OF QUARTER WILL ALLOW SNI TO PUSH OUT THE PAYMENT DUE DATE BY AN
EQUAL AMOUNT OF DAYS LATE. PAYMENT IS DUE BY QUARTER END OR NET 30
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FROM WHEN TECHNOLOGY BECOMES DEDICATED TO END USER- WHICH EVER COMES FIRST.
CONSIGNMENT CONFIGURATION: TO BE DEFINED BY SNI
4. Financing
UNDER CURRENT TERMS AND CONDITIONS REPRESENTED BY THE EXISTING MASTER LEASE
AGREEMENT IN PLACE BETWEEN EMC AND SNI FUTURE SCHEDULES MAY BE ADDED AT
THE THEN CURRENT COMPETITIVE RATES AND TERMS.
THESE FINANCE RATES AND TERMS ALONG WITH THE LINE OF CREDIT PROVIDED TO SNI
WILL BE REVIEWED BY EMC/SNI ON A MONTHLY/QUARTERLY BASIS BY APPROPRIATE
PERSONNEL FROM BOTH ORGANIZATIONS. EMC WILL VALIDATE SNI'S CREDIT LINE ON A
MONTHLY BASIS, NO LATER THAN THE FIRST DAY OF EACH MONTH AND WILL PROVIDE
ANY UPATE INFORMATION TO SNI'S CFO, CONTROLLER OR OTHER APPROPRIATE
PERSONNEL EMPLOYED BY SNI.
5. No Solicitation Clause:
XXX agrees that it will not, during the term of this Addendum, and for a
period of six months after the date of termination, cancellation or
expiration of this Addendum , hire nor solicit the employment in any
capacity whatsoever of any employees of EMC, unless otherwise mutually
agreed to by both parties.
6. Termination of Purchase Commitments:
Provided that SNI has purchased and paid for at least [**] of EMC
products, and with thirty days prior written notice, SNI may terminate this
Addendum if EMC sells "shared storage." Shared storage is a product
offering of EMC (that is separate and distinct from the shared storage
products and services currently and hereafter offered by the EMC Internet
Services Group) that utilizes EMC storage products on a non-exclusive
basis.
7. Operational Considerations:
EMC TECHNOLOGY ADVANCEMENTS: SNI MAY PARTAKE IN ALL EMC BETA PROGRAMS AS
ANNOUNCED AND AS APPLICABLE.
. EMC AGREES THAT UPON GENERAL RELEASE OF VIRTUALIZATION FUNCTIONALITY, ALL
EXISTING SYMMETRIX' PURCHASED BY SNI WILL BE PROVIDED THE VIRTUALIZATION
UPGRADE SOFTWARE AT NO ADDITIONAL COST TO SNI. EMC ALSO AGREES THAT SNI
WILL BE A MAJOR PART OF ALL BETA TESTING OF VIRTUALIZATION SOFTWARE
FUNCTIONALITY
PARTITIONING OF THE SYMMETRIX: "VIRTUALIZATION" - SYMMETRIX ACCESS CONTROL
IS BEING IMPLEMENTED IN THE FOLLOWING PHASES:
. AT END OF [**], IF EMC HAS NOT PROVIDED VIRTUALIZATION FUNCTIONALITY AS
DESCRIBED IN PHASE I, SNI MAY ELECT TO TERMINATE THIS ADDENDUM.
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. IF AT THE BEGINNING OF [**], EMC HAS NOT PROVIDED VIRTUALIZATION
FUNCTIONALITY AS DESCRIBED IN PHASE II, SNI MAY ELECT TO TERMINATE THIS
ADDENDUM.
. Phase 1: Available [**]. Permits user configurable system call
blocking by Symmetrix port. This feature has been implemented and has
been patched back to micro-code level 65 This feature does not require
changes to existing API's and applications Phase 1QA [**]and is
approximately [**].
. Phase 2: Available ([**] Beta release to SNI) Permits creation of user
defined groups of logical Symmetrix devices. This feature is a planned
deliverable for micro-code level 67 This feature allows partitioned
control of the Symmetrix per user defined device group For Example:
TimeFinder and SRDF Control can be partitioned for multiple customers
on the same Symmetrix To take advantage of this feature, changes must
be made to existing API's and applications Phase 2 requirements [**],
and [**].
. Demonstration Technology
DEMONSTRATION SYMMETRIX FOR SNI: EMC AGREES TO PROVIDE SNI WITH A
SYMMETRIX TO BE USED BY SNI SOLELY FOR DEMONSTRATION PURPOSES AT SNI
CORPORATE, WALTHAM, MA - WITH THE FOLLOWING CONFIGURATION:
SYMMETRIX 3930, 28 X 2020-36m2, 2 X DP2-USD4SW, 6 X DP2-FCD2, 2 X DP-
RLD2'S, 6x50 METER CABLES, 8GB CACHE, CONTROL CENTER PACKAGE,
TIMEFINDER OPEN AND NT, SRDF, VOLUME LOGIX
EMC WILL AGREE TO DELIVER TO SNI H/Q WITHIN TWO WEEKS OF APPROVED AND
EXECUTED ADDENDUM.
DELIVERY TIMELINES: WITH CONSIGNMENT STRATEGY DEPLOYED, DELIVERY
TIMELINE ISSUES WILL BE LARGELY REDUCED. FOR DELIVERY ISSUES NOT
HANDLED BY CONSIGNMENT STRATEGY, EMC AGREES TO A 10 DAY TURN AROUND
FOR ALL HARDWARE AND SOFTWARE ITEMS.
NOTE: THIS 10 DAY TURNAROUND IS REQUIRED TO ALLOW EMC TO ADDRESS AND
RESPOND TO ANY SHORT INVENTORY ISSUES, AS WELL AS NORMAL ALLOCATION,
TESTING AND PREPARATION PROCESSES EMC REQUIRES ON ANY PRODUCT TO BE
SHIPPED.
EMC WILL PROVIDE ONE POINT OF CONTACT FOR DELIVERY INFORMATION: TBD
EMC WILL PROVIDE ONE POINT OF CONTACT FOR PS PAYMENT AND TRACKING:
TBD
EMC TO ASSIGN DEDICATED APPLICATION TECHNOLOGIES AND SYSTEMS ENGINEER
TO SNI:
APPLICATION TECHNOLOGIST: LOLIT XXXXX, EMC - NEWTON, MA SYSTEMS
ENGINEER: TBD
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. Software Development and Evaluation Technology
EMC API FEES AND RUNTIME LICENSE FEES TO BE FURTHER DISCUSSED AND
REVIEWED BY BOTH PARITIES PRIOR TO RESTRUCTURING PRESENT FORMAT
ENGINEERING:
. EMC EVALUATION EQUIPMENT TO BE PROVIDED TO SNI AT NO CHARGE WITH
EMC APPROVAL. UPON APPROVAL AND EXECUTION OF THIS ADDENDUM EMC
WILL SHIP [**] WORTH OF EVAL EQUIPMENT. THE REMAINING PORTION OF
EVALUATION EQUIPMENT TO BE PROVIDED TO SNI WILL SHIP
PROPORTIONATELY AGAINST [**] DOLLARS
. EVALUATION EQUIPMENT IS NOT TO EXCEED AT ANY ONE TIME A TOTAL
VALUE, TO BE CALCULATED USING THE VOLUME PURCHASE ADDENDUM
DISCOUNTING STRUCTURE, OF [**]OR [**] OF THE TOTAL SNI PURCHASES
FROM EMC DURING THE YEAR 2000, WHICH EVER IS LESSER.
. EMC ACT BETA TEST PROGRAM WILL CONTINUE TO BE MADE AVAILABLE TO
SNI
8. Sales and Marketing Partnership
The parties will engage in the following sales and marketing activities. The
specific implementation of the following activities will be approved by Xxx
Xxxxxx or Xxxx Xxxxxxx. EMC reserves the right to delay or defer one or more
of the sales and marketing activities set forth below due to any pending or
contemplated offering of securities by SNI.
INTERNAL AND EXTERNAL ANNOUNCEMENTS
INTERNAL: WITH SNI INPUT, EMC WILL GENERATE AN ATTACK PACK TO BE
DISTRIBUTED TO ENTIRE EMC FIELD. ATTACK PACK TO INCLUDE INFORMATION
NECESSARY FOR EMC FIELD TO UNDERSTAND ALL RELATIVE BENEFITS PERTAINING TO
THE SNI PARTNERSHIP:
. VALUE STATEMENT - OVERVIEW OF SNI'S MANAGED SERVICE MODEL AND STRENGTH
IN THE INDUSTRY
. SUCCESS STORIES (CO GENERATED)
. MUTUAL RULES OF ENGAGEMENT
. PROCESS AND OPERATIONS (MUTUAL AGREEMENT ON STEPS IN THE SALES CYCLE,
FROM INCEPTION TO CONCLUSION FOR BOTH COMPANIES). METHOD FOR
DETERMINING ACCOUNTS WHICH WILL BENEFIT FROM JOINT ACTIVITIES WILL BE
DETERMINED.
. QUESTION/ANSWER SECTION DESIGNED TO ADDRESS EMC FIELD REVENUE CREDIT
AND COMPENSATION QUESTIONS EMC AND \SNI WILL GENERATE AND INVOLVE EMC
IN A SIMILAR SNI ATTACK PACK TO BE CREATED AND DISTRIBUTED TO ENTIRE
SNI FIELD
. INTERNET - EXTERNAL: XXX.XXX TO ANNOUNCE EMC/SNI PARTNERSHIP AND
PROVIDE A HYPERLINK TO THE SNI WEB SITE
. INTERNET - EXTERNAL: XXXXXXXXXXXXXXX.XXX TO ANNOUNCE SNI/EMC
PARTNERSHIP AND PROVIDE A HYPERLINK TO EMC WEB SITE
. PRESS RELEASES FOR SHARED END USER CUSTOMERS WILL INCLUDE BOTH
COMPANIES NAMES
. EMC WILL EXECUTE A PRESS RELEASE ANNOUNCING SNI AS EMC'S TIER ONE
CHANNEL PROVIDER AND PROFESSIONAL SERVICES PROVIDER OF CHOICE.
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. SNI WILL EXECUTE A PRESS RELEASE ANNOUNCING EMC AS TECHNOLOGY PROVIDER
OF CHOICE TO ADDRESS SERVICE LEVEL AGREEMENTS
EMC SANCTIONED TRAINING SCHEDULE
. TRAINING EVENT TO INCLUDE: EMC AREA MEETING WHERE SNI AND EMC
INTRODUCE OR RE INTRODUCE THE EMC/SNI PARTNERSHIP, SNI'S VALUE
PROPOSITION, STRENGTH IN THE INDUSTRY, TARGET MARKET AND OVERALL
BENEFIT OF PARTNERSHIP
. CITIES TO INCLUDE: SEATTLE, SAN FRANCISCO, LOS ANGELES, CHICAGO,
DENVER, WASHINGTON DC, ATLANTA, NEW YORK, PHILADELPHIA, BOSTON,
HOUSTON, XXXXXX, XXXXXX, LONDON, FRANKFURT
. WEEKLY/MONTHLY AND QUARTERLY FIELD SALES VISITS TARGETED TO ASSIST
EMC/SNI JOINT SALES EFFORTS IN SPECIFIC ACCOUNT OPPORTUNITIES.
. EMC MARKETING TO COORDINATE WITH SNI MARKETING TO CO CREATE AND CO
DELIVER JOINT PRESS RELEASE TO MEDIA (E.G.. EMC PROVEN PROGRAM)
. EMC SEMINAR SERIES TO CONTINUE INTO 2000 WITH 2 SERIES, 6-12 CITIES
EACH SERIES
. JOINT ADVERTISING PROGRAM COSTS TO BE EQUALLY SHARED AS DESCRIBED IN
EMC'S MARKETING CO OP PROGRAM
. SNI WILL HAVE THE OPTION OF PARTICIPATING AT EMC SCHEDULED TRADE SHOW
EVENTS
. COOP DOLLARS OR MARKET DEVELOPMENT FUNDS PROGRAM TO CONTINUE
9. Term
The term of this Addendum will be from February 2, 2000 through December 31,
2000.
Authorized Signature: StorageNetworks, Inc. Authorized Signature: XXX
Xxxxxxxxxxx
_________________________ ___________________________
Name Name
_________________________ ___________________________
Print Print
_________________________ ___________________________
Title Title
_________________________ ___________________________
Date Date
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