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EXHIBIT 10.28
MARKETING AGREEMENT
This Marketing Agreement (hereinafter the "Agreement") is made
this 1st day of March, 2000, by and between BuildNet Financial
Services, Inc., a North Carolina Corporation , with its principal place
of business located at 4813 Emperor Boulevard, Suite 103, Durham, North
Carolina 27703 ("BuildNet") and mortgage.com, inc., a Florida
corporation, with its principal place of business located at 1643 N.
Harrison Parkway, Building H, Sunrise, Florida 33323 ("MDC").
RECITALS
WHEREAS, MDC is engaged in, among other activities,
originating, processing, underwriting, closing and funding first-lien
and second-lien, prime and sub-prime residential mortgage loans
throughout the United States and also offers a "Rapid Response Mortgage
Center (RRMC)", which is dedicated hardware, software,
telecommunications equipment and marketing materials designed to be
placed in a home builder's office for the purpose of allowing customers
of the home builder (the "Consumers") to make applications for mortgage
loans via the Internet on the MDC web site, www.mortgage.com (the "MDC
Site") or the telephone, (hereinafter the "MDC Products");
WHEREAS, BuildNet develops and provides software and back
office services for the home builder industry and a transaction
enabling web based system for builders, suppliers and manufacturers;
WHEREAS, BuildNet and MDC wish to enter into a marketing
arrangement whereby BuildNet will market, advertise, promote and
stimulate sales of the MDC Products to the home builder industry; and
WHEREAS, BuildNet and MDC wish to establish a version of the
MDC Site (the "Co-Branded Site") through which users of the Co-Branded
Site at RRMC locations (defined as customers of residential real estate
builders or developers and hereafter known as "Consumers") would have
the opportunity to purchase residential permanent mortgage products
offered by MDC through BuildNet.
AGREEMENT
NOW, THEREFORE, MDC and BuildNet agree as follows:
1. MARKETING AGREEMENT
1.1. BUILDNET MARKETING SERVICES
BuildNet shall use commercially reasonable efforts to market,
advertise, promote and sell the MDC's residential permanent mortgage
products to various homebuilders and other similar type businesses (the
term "Contacts" to be defined as a natural person or legal entity
licensed by all applicable federal, state and local government
authority and
Portions of this exhibit marked by [*] have been omitted pursuant to a
request for confidential treatment.
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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whose principal business is to construct new homes for sale to the
public in the United States). BuildNet shall cause each Contact to
execute the Builder Marketing Agreement of which a finalized version
shall be attached hereto as Exhibit A (a "Participating Builder")
within sixty (60) days from the effective date of this Agreement. MDC
reserves the right to accept or reject the sale of MDC Products to any
Contact based upon commercially reasonable standards. All Participating
Builders shall be set forth on Exhibit B which shall be amended from
time to time. In furtherance thereof, BuildNet shall conduct the
promotional activities described in Exhibit C (the "Marketing Plan").
Notwithstanding the previous sentence, in the event the Marketing Plan
is not completed before signing the Agreement, it shall be provided to
MDC for its written approval within sixty (60) days of the effective
date hereof; in the event the Marketing Plan is not approved by MDC,
MDC shall give BuildNet thirty (30) days written notice of disapproval
setting forth in reasonable detail the reasons for disapproval (the
"MDC Objection"). In the event the Marketing Plan is not amended by
BuildNet in conformity with the MDC Objection, either party shall have
the right to terminate this agreement upon thirty (30) days written
notice of the date of the MDC Objection. Moreover, at any time during
the Term, either party shall have the right to propose a modification
to the Marketing Plan following the procedure set forth above.
1.2. BUILDNET MANAGEMENT SERVICES
BuildNet shall perform the following managerial duties for
each Contact which it establishes through its marketing efforts:
1.2.1. actively participate in the oversight of the
relationship between the Contact and MDC;
1.2.2. act as a liaison between the Contact and MDC upon the
reasonable request of MDC;
1.2.3. assist the Contact in the performance of its duties
as required under the Builder Marketing Agreement
with BuildNet;
1.2.4. conduct monthly on-site meetings with the Contact, as
necessary in BuildNet's sole discretion;;
1.2.5. conduct monthly meetings with MDC management, in
person or by phone, to review all Contact accounts
and their progress; and
1.2.6. provide other such assistance in enhancing the
relationship between MDC and the Contact as MDC
and/or the Contact may reasonably request from time
to time.
1.3. TERM
The Term of this Agreement shall commence as of the date set
forth above (the "Effective Date") and end on the last day of the
twenty-fourth (24th) calendar month following such date subject to
renewal as follows: The Term shall automatically be
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extended for additional consecutive twelve month (12) renewal periods
(each a "Renewal Term") unless (i) either party provides written notice
to the other party at least thirty (30) days prior to expiration of the
Term, or any renewal thereof, of its desire not to renew or (ii) at
MDC's sole discretion if BuildNet fails to meet such performance
criteria as set forth in Section 1.3.1 and 1.3.2 herein so long as MDC
has not contributed in any way to BuildNet's failure to meet said
performance criteria as further described in Section 1.3.3. Any
reference herein to the "Term" shall include each Renewal Term. This
Agreement may be terminated upon mutual agreement of the parties or
upon a material breach by either party not cured within the time set
forth in Section 6.13. Notwithstanding termination of this Agreement by
MDC for reasons other than for breach of contract, BuildNet shall be
entitled to compensation at the rates provided herein for all
transactions, as hereinafter defined, in process.
1.3.1. During the first twelve months from the Effective
Date (the "First Year"), BuildNet shall execute a
minimum of [*] Builder Marketing Agreements between
BuildNet and a home builder to market and promote the
MDC Products to Consumers. In addition, MDC shall
receive a minimum of [*] during the First Year from
Consumers. For purposes of this Agreement, the term
[*].
1.3.2. During the thirteenth (13th) through the
twenty-fourth (24th) month from the Effective Date
(the "Second Year"), BuildNet shall execute a minimum
of an additional [*] Builder Marketing Agreements
between BuildNet and a home builder to market and
promote the MDC Products to Consumers. In addition,
MDC shall receive a minimum of [*] during the Second
Year from Consumers.
1.3.3. MDC recognizes that the commitments made in sections
1.3.1 and 1.3.2, above are contingent upon not only
BuildNet's performance under this Agreement, but also
upon MDC's delivery of basic fulfillment products and
services including, but not limited to customer
services, web site accessibility, and competitive
products and pricing.
1.3.4. Effect of Termination. Should this Agreement be
terminated, MDC agrees that the obligations it has to
any Contacts shall remain in full force and effect
for the term of said Contact Marketing Agreement.
BuildNet shall have, after any termination, the sole
discretion to select another provider of services
similar to that of MDC for any Contact Marketing
Agreement entered into hereunder. Upon implementation
of such a provider, MDC's obligations to any Contact
shall cease other than for outstanding loan and
application commitments. MDC shall provide reasonable
assistance in transitioning Contacts to the new
provider.
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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1.4. EXCLUSIVITY
BuildNet shall market, advertise and promote the MDC Products
to Contacts on an exclusive basis, and for the term hereof will not
promote permanent residential mortgage products of other mortgage
lenders to Homebuilders, as hereinafter defined, except as set forth
herein. Notwithstanding the foregoing, BuildNet may market, promote and
advertise General Electric's mortgage products and services to anyone
including Homebuilders. Homebuilder is a legal entity licensed by all
applicable federal, state and local government authority and whose
principal business is to construct new homes for sale to the public in
the United States.
1.4.1. Except as to existing clients of MDC as set forth on
Exhibit D, BuildNet shall have the exclusive right to
market, advertise and promote the MDC Products to
Contacts, and, accordingly, for the term hereof,
BuildNet will not market, advertise, promote or offer
residential mortgage products of any mortgage
lenders, other than those of MDC to Contacts.
Notwithstanding the foregoing, MDC clients listed on
Exhibit B, who in BuildNet after execution of this
Agreement will automatically be removed from Exhibit
D.
1.4.2. In the event that a Contact desires to purchase from
MDC any residential mortgage services offered by MDC
including but not limited to (i) mortgage banking
services such as originating, processing,
underwriting, closing, funding and selling loans, or
(ii) the development, marketing, sale and operating
of Web Sites for consumers to obtain residential
loans or (iii) the development, marketing, sale and
operation of private label web sites or (iv) net
branch operations, point of sale kiosks and rapid
response centers or any other internet technology
related services, which services are hereinafter
collectively referred to as "Other Services" and in
the event such Other Services are not available
through (i) the MDC Products or (ii) a program
jointly developed by BuildNet and MDC that in
BuildNet's reasonable sole discretion meets the
requirements of such Contact, MDC may offer such
services to any such Contact notwithstanding the
exclusivity provisions set forth above.
1.4.3. For the term of this Agreement, MDC shall not enter
into any agreements with any entity that is a
competitor of BuildNet, as hereinafter defined (the
"BuildNet Competitors"), to provide the MDC Products.
BuildNet shall provide to MDC an initial list, which
may be amended from time to time, of all BuildNet
Competitors and such list shall be set forth on
Exhibit E and made a part of this Agreement.
Notwithstanding the foregoing, MDC shall use its best
efforts to identify potential MDC clients, not on the
list in Exhibit E, who may also be competitors of
BuildNet and seek BuildNet approval before entering
into an agreement with said client to provide the MDC
Products offered hereunder. For purposes of this
Agreement, the term " BuildNet Competitor" shall mean
(i) a Contact that offers mortgage services to its
clients, other than those excluded pursuant to
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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Section 1.4.1 and Exhibit E, or (ii) an entity which
offers back office administrative or transaction
processing software for homebuilders with the same or
similar functionality as the proprietary software of
BuildNet which includes, but is not limited to,
purchase ordering, invoicing, scheduling and job
costing in connection with the construction of homes,
or (iii) any person or entity, which is not a
homebuilder, which over the previous three fiscal
years has obtained more than [*] of its total
mortgage revenues through leads generated from
homebuilders as demonstrated by audited or if
unavailable, unaudited financial statements.
1.4.4. Notwithstanding anything contained herein to the
contrary, nothing contained herein shall limit the
right of MDC to enter into any agreement to provide
any services or products, including the services and
products offered hereunder to any person or entity,
which is not a Contact, which over the previous three
fiscal years has obtained no more than [*] of its
total mortgage revenues through leads generated from
homebuilders as demonstrated by audited or if
unavailable, unaudited financial statements. In
addition, MDC shall have the right to enter into an
agreement with a BuildNet Competitor relating solely
to the sale of debt or equity securities of MDC.
1.5. MDC MAINTENANCE AND SUPPORT OBLIGATIONS.
1.5.1. MDC shall maintain and upgrade the RRMC at its sole
expense. This maintenance shall include, but is not
limited to, upgrading computer hardware, software,
modems, cables, replacing damaged software and
hardware, maintaining the communications link between
the RRMC and the communications provider, and
maintaining the RRMC internal support structure of
the RRMC. At least annually, MDC shall perform a site
survey, by the method of its choice, to determine the
condition of the RRMC and shall replace or repair any
items that prevent the RRMC from functioning
according to the terms and conditions of this
Agreement. MDC shall promptly respond to all Contact
inquiries regarding the condition of the RRMC and
shall repair problems with the RRMC according to the
following schedule:
(i) Critical issues - Those problems that impair
the functioning of the RRMC in such a way to
prevent Customer applications from being
received, either whole or in-part, or
without corruption by MDC. Critical issues
shall be addressed and repaired within
forty-eight hours of receipt of notice of
the Critical issue.
(ii) Mid-Priority issues- Those problems that
have some impact on the function of the RRMC
such as slowing down response time,
intermittent system crashes, etc..
Mid-Priority issues shall be addressed by
MDC within 96 hours of receipt of issue.
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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(iii) Low-Priority issues- Those problems that do
not impair the functioning of the RRMC, nor
slow down the down the system functionality.
Low-Priority issues should be addressed
within 10 days of receipt of notice of the
issue.
1.5.2. MDC shall provide, upon request a log of
issues/problems experienced at the various RRMC sites
set up under this Agreement. BuildNet shall be solely
responsible for the marketing pieces associated with
the RRMC which include marketing literature, external
marketing appearance and structure(not including
physical support structure).
1.6. MDC CO-BRANDED SITE DEVELOPMENT, HOSTING AND MAINTENANCE
MDC shall create, host and maintain the Co-Branded Site for
use in the RRMC kiosks. The parties agree that the information and data
contained on the Co-Branded pages shall be physically located on a web
server owned and/or operated by MDC. The Co-Branded Site shall contain
the legend "BuildNet Financial powered by Mortgage.Com" in a clear an
conspicuous manner on the each respective home page. MDC agrees to host
and maintain the Co-Branded Site pursuant to the standards set forth in
Exhibit G. MDC and BuildNet will confer and mutually agree on
Co-Branded Site design, provided that such pages shall be consistent
with the MDC functionality. MDC shall incorporate some or all of
BuildNet Materials (as defined in Section 2.4), as well as any other
text, graphics, animation, scripts or other materials deemed necessary
or desirable by both parties within the frame of the Co-Branded Site.
BuildNet shall control and make all final decisions regarding the
frame, its layout, displays and linkages. No links or link exchanges
will be placed by MDC on the BuildNet Co-Branded site without prior
approval of BuildNet.. BuildNet may request that MDC modify the design
of the Co-Branded pages. MDC shall respond to such reasonable requests
of BuildNet and provide time frames in which such requests will be
completed. MDC shall not unreasonably reject any such request by
BuildNet to modify the design of the Co-Branded pages. MDC agrees that
part of this design will include site navigation that will allow users
to return to the BuildNet Sites through a text or logo link provided by
BuildNet (the "Return Icon"). MDC shall customize the Co-Branded Site
such that the home page of the Co-Branded Site will allow the Consumer
to identify the builder in or other location where the RRMC resides.
Upon selection of the appropriate builder by the Consumer, the Consumer
will then be forwarded to a customized home page for the RRMC. Each
builder shall have the ability to access the loan application status of
each Consumer it referred to the Site. BuildNet shall have the ability
to obtain loan application status for every Consumer that applies
through the Co-Branded Site. In addition, all customized builder home
pages shall be accessible via their own unique URL address. Any
additional customization work for builder home pages or the Co-Branded
Site, as per a written work order signed by BuildNet, shall be billed
to BuildNet at a rate of [*].
1.6.1. Site identification and workflow
The home page of the Co-Branded Site shall reference
BuildNet as the provider of the site, as opposed to MDC.
During the application process,
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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Consumers will be notified on the site and in writing that the
lender for the Co-Branded Site is First Mortgage Network, a
trade name of MDC and the entity that has been selected to
provide application, processing, underwriting and closing
services for BuildNet Consumers. Customer service and loan
processing for loan applications originated on the Co-Branded
Site shall be conducted under the name of First Mortgage
Network. Phone calls fielded from the toll free number
featured on the Co-Branded Site shall be answered in the name
of "BuildNet Financial," or in the name of the sponsor of the
Co-Branded Site. Final closing documents, including but not
limited to the Note and Deed of Trust, shall identify the
lender as "mortgage.com, inc. dba First Mortgage Network." MDC
reserves the right to modify the Co-Branded Site
identification and workflow described in this paragraph as may
be required from time to time by state or federal licensing
and regulatory requirements.
1.7. MAINTENANCE
Information maintained on the Co-branded pages shall be
updated on a regular basis to reflect the changes in functionality
exhibited on the MDC Site. The Co-Branded Site shall contain
functionality to originate prime credit loans (defined as conforming to
either Fannie Freddie MAC, underwriting guidelines or jumbo or
portfolio loans to non-agency guidelines), sub-prime credit loans
(defined as not conforming to Fannie Mae or Federal Home Loan Mortgage
Corporation underwriting guidelines) and home equity lines of credit.
MDC shall update and maintain the Co-Branded Site on a regular basis.
1.8. APPLICATION COMPLETION
MDC agrees to provide, under the terms of this Agreement, a
method for Consumers to begin or complete the residential mortgage
application started through the RMMC. This method may take the form of
a hyperlink, web site or other secure Internet approach. The MDC
approach shall provide for appropriate linking and tracking to meet the
tracking requirements of Section 3.5.
2. MDC PERMISSIONS
2.1. MDC PERMISSIONS
MDC hereby grants to BuildNet the nonexclusive,
nontransferable, nonassignable (except as provided in Section 6.1)
right during the Term to use (i.e., to copy, transmit, distribute,
display and perform both privately and publicly) the MDC name, the MDC
Site name and other related textual and graphic material that are
provided by MDC to BuildNet for the express purpose of inclusion in the
BuildNet marketing presentation from time to time (collectively, the
"MDC Materials") for the specific purposes authorized in Section 1.1
and Section 1.2. MDC also authorizes BuildNet to refer in BuildNet's
advertising and promotion to the fact that the MDC Products are
available through BuildNet, provided that any such statement (a) does
not include any trademarks, service marks, design marks, symbols and/or
other indicia or origin of MDC other than MDC's name and/or the MDC
Site name in a non-distinctive typeface (i.e., not the
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typeface used in the logo design of any MDC mark); (b) does not state,
suggest or imply by the wording or prominence of such statement, or
otherwise, that MDC sponsors, authorizes and/or is the source or origin
of the BuildNet Site and (c) does not disparage MDC, its products,
services or affiliates. All use of MDC Materials hereunder shall inure
to the benefit of MDC and shall not create any rights, title or
interest in them for BuildNet. No other use of MDC's names, trademarks,
services marks, design marks, symbols and/or other indicia of origin or
other designations confusingly similar to any of the foregoing may be
made by BuildNet for any purpose without the prior written approval of
MDC. As between MDC and BuildNet, MDC owns and shall continue to own,
exclusively, all right, title and interest (including, without
limitation, all rights provided under the law of copyright and
trademark) in and to the MDC Materials, MDC Site and all names,
trademarks, service marks, design marks, symbols and/or indicia of
origin therein throughout the world and in perpetuity, subject to the
permissions granted in this Agreement.
2.2. MDC MORTGAGE PRODUCTS & PRICING
MDC shall have the right to decide which residential mortgage
products it will offer to Consumers, and has sole discretion to approve
or reject any credit applications it receives, and to determine the
criteria on which these decisions will be based. MDC shall set the
pricing and lender fees of the MDC Products equal to those prices as
found on the MDC Site with the exception that MDC shall add up to [*]
to points for all products offered. Such pricing may be adjusted in
writing by mutual agreement of the parties from time to time.
Notwithstanding the foregoing, MDC agrees to cooperate and confer as
may be reasonably requested by BuildNet regarding the foregoing.
2.3. CUSTOMER SERVICE & TECHNICAL SUPPORT INQUIRIES.
All customer service or technical support inquiries shall be
directed to an email address and phone numbers specified by MDC, and
MDC shall respond to all associated first-line customer service and
technical support inquiries from Consumers. MDC shall provide such
technical support at service levels in accordance with its standard
policies and procedures, as set forth in Exhibit F, but shall provide
support not less than an amount that is commercially reasonable and
customary in the industry. Both parties will assign content project
managers to manage the development and maintenance, which results from
the execution of this Agreement.
2.4. BUILDNET PERMISSIONS
BuildNet hereby grants to MDC, its affiliates and agents the
nonexclusive, nontransferable, nonassignable (except as provided in
Section 6.1) right during the Term to use (i.e., to copy, transmit,
distribute, display and perform both privately and publicly) BuildNet's
name, the name of the BuildNet Sites (including
www.BuildnetFinancial.com, www.BuildnetFinancial.org and
www.BuildnetFinancial.net), and other related textual and graphic
material that are provided by BuildNet to MDC for the express purpose
of inclusion on the RRMC from time to time (collectively, the "BuildNet
Materials") solely on the RRMC for the specific
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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purposes permitted hereunder. BuildNet also authorizes MDC to refer in
MDC's advertising and promotion to the fact that the RRMC is accessible
through the Participating Builder's facilities, provided that any such
statement (a) does not include any trademarks, service marks, design
marks, URL Addresses symbols and/or other indicia of origin of
BuildNet, except as provided in the BuildNet Materials; and (b) does
not disparage BuildNet, its products, services or affiliates. All use
of the BuildNet Materials hereunder shall inure to the benefit of
BuildNet and shall not create any rights, title or interest in them for
MDC. No other use of BuildNet's names, trademarks, services marks,
design marks, symbols and/or other indicia of origin will be made by
MDC for any purpose without the prior written approval of BuildNet. As
between MDC and BuildNet, BuildNet owns and shall continue to own,
exclusively, all right, title and interest (including, without
limitation, all rights provided under the law of copyright and
trademark) in and to the BuildNet Materials and all names, trademarks,
service marks, design marks, URL Addresses, symbols and/or indicia of
origin therein throughout the world and in perpetuity, subject to the
permissions granted in this Agreement.
2.4.1. MDC agrees that any use of the BuildNet Materials, by
MDC shall be subject to review and approval in
advance by BuildNet. BuildNet shall retain the right,
in its sole discretion, to demand immediate
modification, revision or cessation of the use of
BuildNet Materials in the event that BuildNet
determines that the BuildNet Materials are being used
improperly. Without limiting the generality of the
foregoing, MDC shall not use BuildNet Materials in a
manner that BuildNet determines to be inappropriate
or unacceptable.
3. FEES
3.1. TRANSACTIONS
The parties believe and have agreed that the fair market value
of the BuildNet marketing services to be performed under this Agreement
[*] and further agree, consistent with Section 8 of the Real Estate
Settlement Procedures Act of 1974 as amended ("RESPA"), that MDC's
payments to BuildNet for its marketing services in any annual period
may be less than, but can not exceed, this fair market value amount.
For its performance of the marketing services set forth herein from the
effective Date of the contract through December 31, 2000, BuildNet
shall be entitled to an Fee of [*], which fee shall be paid by MDC in
the following manner and at the following rates until the aggregate
fees in any annual period equal the Annual Marketing Fee. MDC shall pay
BuildNet the sum of [*] originated from a Participating Builder.
BuildNet shall pay each Participating Builder the sum of [*], up to,
but not exceeding the fair market value of the marketing services
performed by each Participating Builder. BuildNet shall set the
individual value of each Contact Marketing Agreement, following the
form of Exhibit A, entered into between BuildNet and Contact. If MDC's
payments to BuildNet for its marketing services exceed the Annual
Marketing Fee during any annual period, BuildNet agrees to return any
excess to MDC with interest calculated at Prime within ten (10) days of
discovering or being informed that it has
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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received more than the fair market value amount. MDC shall have
exclusive right in determining whether a mortgage loan meets its
criteria as a conforming, sub prime or second lien home equity line of
credit loan. For purposes of this Agreement, "Prime" shall be defined
as the interest rate, commonly known as the "Prime Rate", set by the
Federal Reserve Bank and which represents the lowest rate a bank will
charge its best large customers for a loan. All fees in this Section
3.1 may be adjusted by mutual agreement in writing between the parties.
3.1.1. For future marketing services, beginning on January
1, 2001, both parties shall, within 30 days of
year-end, reassess the fair market value of
BuildNet's marketing services and mutually agree upon
the valuation to be paid by MDC.
3.2. AUDITING
Either party shall have the right, at its expense, upon thirty
(30) business days written notice and during the other party's normal
business hours, to inspect and audit the directly relevant books and
records of the other party for the purpose of verifying the
performance, any reports, information or payments due under this
Agreement. Any such audit shall be conducted by a firm of independent
certified public accountants reasonably acceptable to the other party.
In the event of any shortfall in payment to BuildNet is found which
exceeds five percent (5%) of the total due to BuildNet for the
reporting period audited, MDC shall reimburse BuildNet for the
reasonable costs incurred in conducting the audit.
3.3. REPORTING AND PAYMENTS
Within fifteen (15) days following the close of each calendar
month during the Term, MDC shall pay BuildNet all amounts due for such
previous month and shall submit with payment a statement providing in
reasonable detail the basis for such payment. BuildNet shall report to
MDC, on a regular basis, regarding the progress of its online
advertising campaign and promotional efforts. Any payment not received
when due shall accrue interest from the date due until the date paid at
ten percent (10%) interest per annum, or if less, the maximum per annum
rate permitted by law.
3.4. DELIVERY OF UNIQUE HYPERLINK
MDC shall furnish to BuildNet prior to the Deployment Date a
unique hyperlink for accessing the Co-Branded site for use in the
RRMCs. If MDC subsequently modifies the Unique Hyperlink, it shall
furnish a representation in the same format which BuildNet shall
substitute for the prior version within ten (10) days after receipt.
During this 10-day notice period, a functional Co-Branded Web Site
shall be available at both the old URL Unique Hyperlink and the new
replacement URL address.
3.5. TRACKING
MDC shall track all visitors to the co-branded sites using the
unique URL associated with each site, as is currently done on all MDC
sites. Additional levels of
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tracking can be accomplished using "sender codes", which are also
currently in use on all MDC sites. MDC shall cooperate reasonably with
BuildNet to identify feasible, lawful, available alternate means to
identify users if the current methods used for this purpose do not
reliably identify and track the source of consumer traffic to the
sites. Notwithstanding the foregoing, MDC shall separately track and
report all electronic mail leads generated by the BuildNet inquiry
forms.
3.5.1. Within 30 days of execution of this Agreement, MDC
shall provide for review and approval a detailed
description of the tracking methodology and
technology used under this Section. If deficiencies
are found by BuildNet in the methodology and
technology, MDC shall make reasonable efforts to
correct the deficiencies and shall submit for
BuildNet's review the corrective measures taken.
3.5.2. BuildNet shall have the right to periodically review
on 15 days notice MDC's tracking methodology and
technology. This review shall take place no more
frequently than semi-annually or upon reasonable
belief that the tracking technology or methodology is
flawed or not functioning correctly.
3.5.3. MDC shall notify BuildNet of any change in the
tracking methodology or technology used under this
Section 15 business days before such change is made.
BuildNet shall have the right of prior approval for
any change that it reasonably believes shall impair
the obligations of tracking under this section.
4. CONFIDENTIAL INFORMATION
4.1. DEFINITION
As used herein, "Confidential Information" shall mean all oral
or written information, of whatever kind and in whatever form, relating
to past, present or future products, software, research, development,
inventions, processes, techniques, designs or other technical
information and date, and marketing plans (including such information
of third parties that a party hereto is obligated to hold as
confidential), provided that such information has been reasonably
identified as or could be reasonably considered to be proprietary or
confidential, that either party (a) may have received prior to the date
of this Agreement, whether directly from the other or indirectly from
third parties, or (b) may receive hereunder from the other. The terms
of this Agreement shall be deemed Confidential Information.
4.2. OBLIGATION
Each party agrees that, with respect to its receipt of
Confidential Information of the other party it shall:
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4.2.1. use the same care and discretion to prevent
disclosure of such Confidential Information as it
uses with similar Confidential Information of its own
that it does not desire to disclose but in no even
with less than a reasonable degree of care;
4.2.2. accept such Confidential Information and use such
Confidential Information only for the purposes
permitted hereunder; and
4.2.3. restrict disclosure of Confidential Information
solely to those of its employees and agents who have
a need to know and are obligated not to disclose such
Confidential Information to any third parties.
4.3. EXCEPTIONS
The restrictions of Section 4.2 shall not apply to information
that:
4.3.1. is or hereafter becomes part of the public domain
through no wrongful act, fault or negligence on the
part of the recipient;
4.3.2. the recipient can reasonably demonstrate, is already
in its possession and not subject to an existing
agreement of confidentiality;
4.3.3. is received from a third party without restriction
and without breach of this Agreement;
4.3.4. was independently developed by the recipient as
evidenced by its records; or
4.3.5. recipient is required to disclose pursuant to a valid
order of a court or other governmental body;
provided, however, that the recipient shall first
have given notice to the disclosing party and shall
give the disclosing party a reasonable opportunity of
at least 10 days to interpose an objection or obtain
a protective order requiring that the confidential
Information so disclosed be used only for the
purposes for which the order was issued.
4.4. RETURN
All notes, data, reference manuals, sketches, drawings,
memoranda, electronic media, records in any way incorporating or
reflecting any Confidential Information of the disclosing party and all
proprietary rights therein shall belong exclusivity to such disclosing
party and the recipient agrees to return all copies of such materials
to the disclosing party immediately upon request or upon termination or
expiration of this Agreement.
4.5. CONSUMER CREDIT INFORMATION
MDC hereby agrees that all information, excluding Social
Security Numbers and credit reports, provided by Consumers who access a
mortgage.com web site or similar
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mortgage.com service either from (i) a BuildNet owned or operated web
site or (ii) a BuildNet software product shall be the sole and
exclusive property of BuildNet (the "BuildNet Consumer Information").
Without limiting the foregoing, "BuildNet Consumer Information" shall
include both completed applications and incomplete applications and/or
web site hit and use information. MDC agrees that it shall not use the
BuildNet Consumer Information for any purpose, except as permitted in
the limited license granted by this Section, or disclose such
information to any third party. BuildNet agrees that it shall use the
BuildNet Consumer Information only for purposes that are consistent
with the BuildNet privacy policy-, as it may be amended from time to
time in the sole discretion of BuildNet. BuildNet hereby grants to MDC
a limited license to use the BuildNet Consumer Information for the sole
purpose of performing its services under this Agreement. MDC shall
supply BuildNet with the BuildNet Consumer Information on a monthly
basis or more frequently as agreed to between the parties. Both parties
agree to comply with all State and Federal laws governing the
confidentiality of consumer credit information, to maintain
confidentiality of this information. It is mutually agreed and
understood under this Agreement that BuildNet is not a lender or
engaged in any way in lending activities, and is solely promoting and
advertising MDC's Products to Consumers. Both parties will comply with
all applicable Federal and State laws, including legal requirements for
disclosures, notices and reporting.
5. LIABILITY
5.1. PRODUCT RESPONSIBILITY
MDC and BuildNet acknowledge that neither advocates or
endorses the purchase or the use of any of the products or services
offered by the other through their respective World Wide Web sites or
otherwise, nor do they guaranty the quality, fitness or results of any
such products or their compliance with any law or regulation.
5.2. REPRESENTATIONS AND WARRANTIES OF MDC
MDC represents and warrants that: (a) MDC has the right to
enter into this Agreement and to grant the rights and licenses granted
herein; (b) the MDC Site and the reproduction, distribution,
transmission, public performance and public display of the MDC Material
in connection with the BuildNet Site do not and will not (i) invade the
right of privacy or publicity of any third person, (ii) contain any
libelous, obscene, indecent or otherwise unlawful material, or (iii)
infringe any patent, copyright or trademark right in any jurisdiction,
or (iv) contravene any other rights of any third person; (c) MDC has
received no notice of such invasion, violation or infringement of
rights; except that the representations and warranties in subsections
(b) and (c) above shall not apply to User Content or Product Content.
Instead, MDC agrees that it shall use commercially reasonable efforts
to monitor and edit such User Content and Product Content and shall use
commercially reasonable efforts to promptly remove any User Content and
Product Content from the MDC Site which fails to conform with the
warranties and representations in subjection (b) above. "User Content"
means content uploaded by parties other than MDC; "Product Content"
means content contained in products sold by parties other than MDC. MDC
shall provide commercially reasonable
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customer service to consumers in connection with the BuildNet site,
subject to the cure provisions set forth in Section 6.13.
5.3. REPRESENTATIONS AND WARRANTIES OF BUILDNET
BuildNet represents and warrants that: (a) BuildNet has the
right to enter into this Agreement and to grant the rights and licenses
granted herein; (b) the BuildNet Site and the Sales Area and the
reproduction, distribution, transmission, public performance and public
display of the BuildNet Materials as permitted herein do not and will
not (i) invade the right of privacy or publicity of any third person,
(ii) contain any libelous, obscene, indecent or otherwise unlawful
material, or (iii) infringe any patent, copyright or trademark right in
any jurisdiction; or (iv) contravene any other rights of any third
person; (c) BuildNet has received no notice of such invasion, violation
or infringement of rights; except that the representations and
warranties in subsections (b) and (c) above shall not apply to User
Content or Product Content. Instead, BuildNet agrees that it shall use
commercially reasonable efforts to monitor and edit such User Content
and Product Content and shall use commercially reasonable efforts to
promptly remove any User Content and Product Content which fails to
conform with the warranties and representations in subsection (b)
above.
5.4. BREACH OF REPRESENTATION, WARRANTY OR COVENANT
Each party to this Agreement shall defend, indemnify and hold
harmless the other party and each of its officers, directors, employees
and agents (each, an "Indemnitee") against and in respect of any loss,
debt, liability, damage, obligation, claim, demand, judgment or
settlement of any nature or kind, known or unknown, liquidated or
unliquidated, including without limitation all reasonable costs and
expenses incurred (legal, accounting or otherwise) (collectively
"Damages") arising out of, resulting from or based upon any claim,
action or proceeding by any third party alleging facts or circumstances
constituting a breach of the representations and warranties of this
Section 5 made by such indemnifying party (the "Indemnifying Party").
5.5. PROCEDURES FOR INDEMNIFICATION
Whenever a claim shall arise for indemnification under this
Section 5, the relevant Indemnities, as appropriate, shall promptly
notify the Indemnifying Party and request the Indemnifying Party to
defend the same. Failure to so notify the Indemnifying Party shall not
relieve the Indemnifying Party of any liability which the Indemnifying
Party might have, except to the extent that such failure prejudices the
Indemnifying Party's ability to defend such claim. The Indemnifying
Party shall have the right to defend against such liability or
assertion in which event the Indemnifying Party shall give written
notice to the relevant Indemnities of acceptance of the defense of such
claim and the identity of counsel selected by the Indemnifying Party.
Except as set forth below, such notice of the relevant Indemnities
shall give the Indemnifying Party full authority to defend, adjust,
compromise or settle such action, suit, proceeding or demand with
respect to which such notice shall have been given, except to the
extent that any compromise or settlement shall prejudice the
intellectual property rights of the relevant Indemnities. The
Indemnifying
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Party shall consult with the relevant Indemnities prior to any
compromise or settlement which would affect the intellectual property
rights or other rights of any Indemnitee, and the relevant Indemnitees
shall have the right to refuse such compromise or settlement and, at
the refusing party's or refusing parties' cost, to take over such
defense, provided that in such event the Indemnifying Party shall not
be responsible for, nor shall it be obligated to indemnify the relevant
Indemnities against, any costs or liability in excess of such refused
compromise or settlement. With respect to any defense accepted by the
Indemnifying Party, the relevant Indemnities shall be entitled to
participate with the Indemnifying Party in such defense if the action
or claim requests equitable relief or other relief that could affect
the rights of the Indemnity and also shall be entitled to employ
separate counsel for such defense at such Indemnities expense. In the
event the Indemnifying Party does not accept the defense of any
indemnified claim as provided above, the relevant Indemnities shall
have the right to employ counsel for such defense at the expense of the
Indemnifying Party. Each party agrees to cooperate and to cause its
employees and agents to cooperate with then other party in the defense
of any such action and the relevant records of each party shall be
available to the other party with respect to any such defense.
5.6. RISK ALLOCATION
NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY (NOR TO ANY
PERSON CLAIMING RIGHTS DERIVED FROM THE OTHER PARTY'S RIGHTS) FOR
INCIDENTAL, INDIRECT, CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY
DAMAGES OF ANY KIND - INCLUDING LOST REVENUES OR PROFITS, LOSS OF
BUSINESS OR LOSS OF DATA - ARISING OUT OF THIS AGREEMENT (INCLUDING
WITHOUT LIMITATION AS A RESULT OF ANY BREACH OF ANY WARRANTY OR OTHER
TERM OF THIS AGREEMENT), REGARDLESS OF WHETHER THE PARTY LIABLE OR
ALLEGEDLY LIABLE WAS ADVISED, HAD OTHER REASON TO KNOW, OR IN FACT KNEW
OF THE POSSIBILITY THEREOF.
5.7. ACKNOWLEDGEMENT OF NO WARRANTY
EXCEPTS AS EXPRESSLY PROVIDED HEREIN, NEITHER PARTY WARRANTS
THAT THEIR RESPECTIVE WEB SITES WILL PERFORM IN THE MANNER EXPECTED OR
WITHOUT INTERRUPTION, ERROR OR DEFECT OR THAT ANY REVENUE TO EITHER
PARTY WILL RESULT FROM THE ACTIVITIES CONTEMPLATED BY THIS AGREEMENT.
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES
ANY WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR WARRANTIES
AGAINST INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS NOT
SPECIFICALLY ENUMERATED.
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5.8. LIMITATION OF LIABILITY
Each party's liability to the other party for any and all
claims and damages incurred by such party relating to or arising out of
the subject matter of this Agreement, whether in contract, tort,
implied warranty, strict liability or other form of action, except for
claims for violations of a party's intellectual property rights, and
any right of indemnity provided herein, shall be limited to the greater
of (x) the amounts paid by MDC to BuildNet pursuant to this Agreement
for the preceding three months or (y) one thousand dollars. BuildNet
and MDC each acknowledge that the provisions of this Agreement were
negotiated to reflect an informed, voluntary allocation between them of
all risks (both known and unknown) associated with the transactions
associated with this Agreement. The warranty disclaimers and
limitations in this Agreement are intended to limit the circumstances
of liability. The remedy limitations, and the limitations of liability,
are separately intended to limit the forms of relief available to the
parties. The provisions of this Section 5.8 shall be enforceable
independent and severable from any other enforceable or unenforceable
provision of this Agreement.
6. MISCELLANEOUS PROVISIONS
6.1. ASSIGNMENT AND CHANGE IN CONTROL
Except as otherwise provided herein, neither MDC nor BuildNet
may assign this Agreement or any of its rights or delegate any of its
duties under this Agreement without prior written consent of the other,
which consent shall not be unreasonably withheld. However, both parties
agree that this Agreement may not be assigned to a competitor of the
other party. In the event of a Change in Control of either party , the
other party has the right to terminate this Agreement upon thirty-(30)
days' notice. A "CHANGE OF CONTROL" means any: (a) sale of all or
substantially all assets either party .; (b) merger, reorganization or
consolidation of either party pursuant to which the stockholders or
successor immediately prior to such merger, reorganization or
consolidation: (i) hold less than 50% of the voting power of the
surviving company following the merger, reorganization or
consolidation, or (ii) in the event that the securities of an
affiliated entity are issued to the stockholders in the transaction in
exchange for their shares, hold less than 50% of the voting power of
such affiliated entity.
6.2. COUNTERPARTS
This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original and all of which together shall be
deemed the same Agreement.
6.3. GOVERNING LAW
This Agreement, its interpretation, performance or any breach
thereof, shall be construed in accordance with, and all questions with
respect thereto shall be determined by, internal, substantive laws of
the State of North Carolina and the venue for any lawsuit, action or
arbitration under this Agreement shall be the courts of Wake County,
North Carolina.. In connection with any judicial proceeding: (i) the
parties consent to the exclusive jurisdiction of the state and federal
courts having jurisdiction over Wake
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County, North Carolina; (ii) both BuildNet and MDC waive personal
service and agree that service of any pleading, notice, complaint, etc.
may be served by certified or registered mail by one party to the other
party at such other party's address for notices as set forth above; and
(iii) such service shall be deemed effective as if personally served
upon the receiving party at its principal place of business. If either
party employs attorneys to enforce any right arising out of or relating
to this Agreement, the prevailing party shall be entitled to recover
reasonable attorneys' fees, in arbitration, litigation, or otherwise.
6.4. HEADINGS
Section headings are for convenience only and are not a part
of the Agreement.
6.5. INDEPENDENT CONTRACTORS
MDC and BuildNet are independent contractors under this
Agreement, and nothing herein shall be construed to create a
partnership, joint venture or agency relationship between MDC. Neither
party has the authority to enter into agreements of any kind on behalf
of the other party.
6.6. INTEGRATION
This Agreement contains the entire understanding of the
parties hereto with respect to the transactions and matters
contemplated hereby, supersedes all previous agreements between
BuildNet and MDC concerning the subject matter, and cannot be amended
except by a writing signed by both parties.
6.7. NO RELIANCE
No party hereto has relied on any statement, representation or
promise of any other party or with any other officer, agent, employee
or attorney for the other party in executing this Agreement except as
expressly stated herein.
6.8. NOTICE
All notices, demands and other communications hereunder shall
be in writing or by written telecommunications, and shall be deemed to
have been duly given: (i) if mailed by certified mail, postage prepaid,
on the date five (5) days from the date of mailing, (ii) if delivered
by overnight courier, when received by the addressee or (iii) if sent
by confirmed telecommunication, one business day following receipt by
the addressee at the following address:
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If to BuildNet:
Barry Drayson
Chairman
BuildNet Financial Services, Inc.
4813 Emperor Boulevard, Suite 103
Durham, NC 27703
With copy to:
Mike Atwood
President
BuildNet, Inc.
4813 Emperor Boulevard, Suite 103
Durham, NC 27703
If to MDC:
Mr. John Hogan
Senior Executive Vice President
mortgage.com, inc.
1643 N. Harrison Parkway
Sunrise, FL 33323
With copy to:
Mr. Michael Brenner
Senior Vice President & General Counsel
mortgage.com, inc.
1643 N. Harrison Parkway
Sunrise, FL 33323
or such other address as either party may specify by notice given in
writing.
6.9. PRESUMPTIONS
In resolving any dispute or construing any provision
hereunder, there shall be no presumptions made or inferences drawn (i)
because the attorneys for one of the parties drafted the agreement,
(ii) because of the drafting history of the agreement; or (iii) because
of the inclusion of a provision not contained in a prior draft, or the
deletion of a provision contained in a prior draft.
6.10. SEVERABILITY
In the event any provision of this Agreement shall for any
reason be held to be invalid, illegal or enforceable in any respect,
the remaining provisions shall remain in full force and effect.
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6.11. SURVIVAL
The provisions of Section 4 and 5 shall survive termination or
expiration of the Agreement.
6.12. WAIVER
No waiver of any breach of any provision of this Agreement
shall constitute a waiver of any prior, concurrent or subsequent breach
of the same of any other provisions hereof, and no waiver shall be
effective unless made in writing and signed by an authorized
representative of the waiving party.
6.13. RIGHT TO CURE
In the event either party desires to assert any remedies for
breach of this Agreement, the party desiring to assert such remedies
shall give the other party thirty (30) days written notice and an
opportunity to cure within ten (10) business days.
6.14. PUBLICITY
6.14.1. Other than the rights granted in this Section,
nothing in this Agreement shall be construed to grant
any right or license to BuildNet in or to any content
or other material supplied by MDC other than the
right to use the content or material in the
marketing, promotion and advertising of the MDC Site.
BuildNet agrees that it will not, without the prior
written consent of MDC in each instance: (i) use in
advertising, publicity, press release or otherwise
the name of MDC, nor any trade name, trademark, trade
device, service mark, symbol or any abbreviation,
contraction or simulation thereof owned by MDC; or
(ii) represent, directly or indirectly, that any
product or any service provided by BuildNet has been
approved or endorsed by MDC. Without in any way
limiting the foregoing restrictions, BuildNet may:
(i) disclose the existence of this Agreement for any
purpose required by law or for the purposes of
financial reporting or disclosure, including, without
limitation, any disclosure or reporting that may be
reasonably required to obtain equity financing; and
(ii) list MDC as a business partner of BuildNet on
BuildNet's internal and external customer lists.
6.14.2. Other than the rights granted in this Section or
elsewhere in the Agreement, nothing in this Agreement
shall be construed to grant any right or license to
MDC in or to any content or other material supplied
by BuildNet other than the right to use the content
or material in the marketing, promotion and
advertising of the MDC Site. MDC agrees that it will
not, without the prior written consent of BuildNet in
each instance: (i) use in advertising, publicity,
press release or otherwise the name of BuildNet, nor
any trade name, trademark, trade device, service
mark, symbol or any abbreviation, contraction or
simulation thereof owned by BuildNet; or (ii)
represent, directly or indirectly, that any product
or any
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service provided by BuildNet has been approved or
endorsed by BuildNet. Without in any way limiting the
foregoing restrictions, MDC may: (i) disclose the
existence of this Agreement for any purpose required
by law or for the purposes of financial reporting or
disclosure, including, without limitation, any
disclosure or reporting that may be reasonably
required to obtain equity financing; and (ii) list
BuildNet as a business partner of BuildNet on
BuildNet's internal and external customer lists.
IN WITNESS WHEREOF, the parties hereto caused their duly authorized
officers to execute this Agreement as of the date set forth above.
BuildNet Financial Services, Inc.
By: /s/ Barry Drayson
----------------------------------------
Name: Barry Drayson
Title: Chairman
mortgage.com, inc.
By: /s/ Michael Brenner
----------------------------------------
Name: Michael Brenner
Title: Executive Vice President
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EXHIBIT A
MARKETING AGREEMENT
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EXHIBIT B
PARTICIPATING LENDERS
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EXHIBIT C
BuildNet Promotional Activities
In addition to those services as described in Sections 1.1 and
1.2, BuildNet shall, using trademarks, information and other material
supplied by BuildNet in context of the RRMC, promote, market, and
advertise the availability of the MDC's Products and services to home
builders looking for residential mortgage solutions for their
Consumers. BuildNet shall promote the availability of the MDC Products
(RRMC) to residential real estate builders and developers which
frequent the BuildNet Sites. BuildNet shall be responsible for the
preparation and dissemination of all promotional materials utilized to
promote MDC's Products as approved by BuildNet. BuildNet shall use
commercially reasonable efforts to attract homebuilders. BuildNet shall
provide a detailed budget and marketing plan outlining the commitment
of BuildNet to effectuate a national sales effort to promote the sale
of the MDC Products to homebuilders. Such marketing plan shall include,
but not be limited to, the following:
o A marketing strategy overview; and
o Completed marketing materials describing the MDC
Products for distribution to the sales staff; and
o Creation of a sales incentive program for the
BuildNet sales force; and
o Scheduling of trade show exhibits for the year 2000;
and
o Completed builder launch kit for each RRMC; and
o BuildNet sales staffing estimates.
BuildNet may enter into agreements with other Internet web
sites or corporate Intranet sites to advertise, market and promote
MDC's Products. Such cooperative marketing arrangements shall be
subject to prior review and written approval of MDC. BuildNet will
submit all such marketing agreements to MDC for approval at least five
(5) business days prior to publication or distribution of such
materials. MDC agrees that approval of such marketing agreements shall
not be unreasonably withheld.
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EXHIBIT D
MDC CLIENTS
[*]
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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EXHIBIT E
BUILDNET COMPETITORS
o [*]
Portions of this exhibit marked by [*] have been omitted pursuant to a request
for confidential treatment.
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EXHIBIT F
MDC SERVICE LEVELS
The professionals at mortgage.com firmly believe in making you, our customer,
a top priority. As a valued customer, you have certain rights. Showing our
respect for your rights in all we do, mortgage.com ensures:
At mortgage.com, you can always count on your personal
mortgage consultant for fast, friendly service. You have the
right to receive a prompt response to your inquiry within 4
hours of your initial contact. You can also expect same-day
credit approvals ... simply submit your application to us by
5:00 PM no matter where you are in the country!
You have the right to privacy and confidentiality. When you
complete your loan application, your personal information is
protected using the latest encryption technology.
We respect your time. Provided that you allow us to use one
of our preferred service providers, we can guarantee your
right to close on or before your desired closing date, as
agreed to at the time you applied. Just be sure to return all
required documentation to us in a timely manner.
You have the right to expect that your closing costs will not
exceed those disclosed to you in your Good Faith Estimate,
again, provided that you select one of our preferred service
providers. PLEASE NOTE: THIS does not apply to prepaid
amounts for taxes, insurance, and mortgage insurance.
Should mortgage.com's personal consultants fall to meet any of these
commitments, as outlined above, we will send you a check for $300.00 once you
close with us.
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EXHIBIT G
WEB SITE HOSTING & MAINTENANCE STANDARDS
The following terms, when used in this Exhibit, shall have the following
meanings:
"DOWN TIME" shall mean any time that the Co-Branded Site is not in a Fully
Functional State for any reason or cause other than; (i) the scheduled services
outages set forth below in Section 2(a)(iv)(1) of this EXHIBIT G; and (ii)
causes which are the fault of the builder or BuildNet.
"FULLY FUNCTIONAL STATE" shall mean that the Co-Branded Site is available for
access and use by Consumers.
MDC shall provide to BuildNet the following hosting services described below for
the Co-Branded Site (the "Hosting Services"):
SUMMARY OF SERVICES
MDC shall procure, provide, install and manage MDC owned Windows NT(R)
web server(s) and all other equipment and telecommunications facilities
unless otherwise agreed upon by the parties, on behalf of BuildNet at
the MDC Service Center. This production server will house the
Co-Branded Site. MDC shall maintain sufficient server capacity and
Internet connectivity throughout the Term to accommodate growth in user
numbers and overall traffic levels to the Co-Branded Site. MDC shall
host and operate the Co-Branded Site such that the users experience
access times and time to retrieve full web pages that are substantially
similar to the access times and time to retrieve full web pages by
users visiting other sites hosted by MDC including, without limitation,
www.mortgage.com.
1. SERVICE MONITORING & MANAGEMENT
(a) MDC will perform continuous monitoring and management of each
Web Site to optimize availability of service. Included within
the scope of Service Monitoring & Management is the proactive
monitoring of the web servers and all service components of
the MDC's firewall for trouble on a 7 day by 24 hour basis,
and the expedient restoration of components when failures
occur within the time period set forth in "Service Outages"
below. MDC shall maintain redundancy in all key components
such that service outages are less likely to occur due to
individual component failures.
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i. Permissible Down Time
1. In any month during the term of this
Agreement, the Web Sites shall be in a Fully
Functional State for no less than
ninety-ninety nine and one half percent
(99.5%) of the time; and shall experience no
more than one half percent (.5%) Down Time
(the "Permissible Down Time"). Permissible
Down Time shall include any scheduled
maintenance.
2. If, during any given month of this
Agreement, the Web Sites fail to remain in a
Fully Functional State in accordance with
2.i.1, above, then BuildNet shall be
entitled and MDC shall remit to BuildNet the
greater of (i) the monthly hosting fee paid
by BuildNet for Web Site hosting divided by
the number of days in the month or (ii) the
monthly hosting fee broken down to an hourly
basis times the number of hours that the
system was down.
3. If the Web Sites remain down for three
consecutive twenty four (24) hour period or
five total twenty four (24) hour periods
(based upon the total number of hours of
down time) during any given month, then
BuildNet shall be entitled to consider MDC
in breach of its hosting requirements and
may seek termination of the Agreement.
ii. Service Hours
MDC's Service Center is staffed 24 hours a day, 7
days a week, to support BuildNet's needs and make all
notifications to BuildNet required pursuant to this Exhibit E.
Automated monitoring tools alert service personnel of problems
on a 7 day by 24-hour basis.
iii. Service Reliability
MDC protects all mission-critical equipment (e.g.,
routers, hubs, servers) in the MDC Service Center with
Uninterruptable Power Supplies (UPS) which are covered by a
service contract. Sufficient sparing levels are kept on-site
for all key equipment components. In addition, MDC has
implemented redundant servers for all key services, such as
routing, DNS and email gateways.
iv. Service Outages
1. Scheduled
MDC scheduled outages must be notified to
BuildNet at least 24 hours in advance, and
shall last no longer than one hour and shall
be scheduled between the hours of 1:00 a.m.
and 5:00 a.m., Eastern Time). MDC may
request extensions of scheduled down time
above one (1) hour and such approval by
BuildNet may not be unreasonably withheld.
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2. Unscheduled
Unscheduled outages are caused by loss of
connectivity to the Internet, or by failure
of a MDC service. In cases where a
destination is not available, or
unacceptable service is reported, MDC will
attempt to determine the source of the
problem and report its findings to BuildNet.
(b) MDC will monitor "heartbeat" signals of all servers,
routers and leased lines, and HTTP availability of
the web server, by proactive probing at 30-second
intervals 24 hours a day using HP Openview as well as
HP ManageX or the equivalent. If a facility does not
respond to a ping-like stimulus, it is immediately
checked again. A second failure will trigger
automatically a page to MDC's Service Center and
selected engineers, as well as generating a log
entry. The Service Center monitors this service 24
hours a day.
(c) When the Customer Service Center receives a "down"
signal, or otherwise has knowledge of a failure in
the production server or the application hardware,
MDC personnel will:
i. Confirm (or disconfirm) the outage by a
direct check of the facility;
ii. If confirmed, take such action as may
restore the service in one hour or less, or,
if determined to be a telephone company
problem, open a trouble ticket with the
telephone company carrier;
iii. Notify the BuildNet Technical Administrator
by telephone or voicemail according to
predefined procedures that an outage has
occurred, providing such details as may be
available, including the MDC ticket number
if appropriate and time of outage;
iv. Work the problems until resolution,
escalating to management or to engineering
as required;
v. Notify the BuildNet Technical Administrator
of final resolution, along with any
pertinent findings or action taken, and
requests concurrence to close the ticket.
2. BACK UPS
a. Back-Up Administration provides for both the regular back-up
of standard file systems, and the timely restoral of data from
a BuildNet request due to a site failure.
i. Perform back-ups of file systems housed in the MDC
Service Center at One Paragon Drive, Suite 240,
Montvale, New Jersey;
ii. Perform weekly full back-ups;
iii. Perform daily incremental back-ups;
iv. Send back-up tapes to secured, off-site storage
facilities with a 30 day rotation of tapes;
v. Retain one back-up tape per month for one year;
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vi. Fulfill restoral requests as directed by BuildNet due
to site failures. Restoral will be performed within
the interval of 2 to 4 hours dependent on the urgency
of the request, and the agreed upon location of the
desired tape.
vii. If the hosting server or location is expected to be
down for more than 24 hours, the MDC will immediately
transfer appropriate back-up data and re-establish
all hosting operations in an appropriately
functioning secondary server or location.
4. SECURITY
a. Monitoring
i. MDC will
1. Limit physical and electronic access to web
servers;
2. Review security notifications and alerts
relevant to the hosting platform (e.g.,
vendor notifications of bugs, attacks,
patches), and apply as appropriate to
maintain the highest level of defense; and
b. Breaches
i. In the event of an attack or threatened or suspected
breach of security against the Co-Branded Site, MDC
will take whatever reasonable steps that are
necessary to halt such action, including taking the
affected Co-Branded Site down. Down time due to
external attacks shall not count against "permissible
down time". MDC will immediately contact BuildNet's
authorized contact to discuss what measure to take.
However, if time is critical, action may be required
before the contact can be reached. MDC's actions will
include:
1. Confirm the threat;
2. Deny access from the source of the attack;
3. Investigate the extent of the damage, if
any;
4. Back-up the affected systems and those
suspected to be affected;
5. Strengthen defenses everywhere, not just the
suspected path that the attacker used;
6. Contact the ISP where the threat or attack
originated and/or law enforcement to work
with MDC's security team;
7. Contact builder and BuildNet to inform them
of the breach;
8. Produce an Incident Report within 24 hours
detailing MDC's findings and distribute the
report to the client(s) affected; and
9. Re-instate the denial of access after a set
time period, but continue to monitor traffic
from that source until risk of further
attacks is deemed to be minimized.
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ii. BuildNet shall have the right to audit MDC security
procedures and actions taken as a result of a breach
of security. Such audit shall include review and
post-mortem analysis of MDC security precautions
taken as a result of the breach and on-site review if
necessary. BuildNet shall bear the costs associated
with any such security audit, except for routine
copying and postage as necessary for MDC to provide
the Incident Report and accompanying data on the
breach to BuildNet.
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