Service Agreement
This Agreement is made as of the 2nd day of Feb. 2000 ("Effective Date") by
and between Cisco Systems, Inc. a California corporation, with offices located
at 170 West Tasman, San Jose, CA 95134 and Cisco's Affiliates ("COMPANY") and
Predictive Systems, Inc., a Delaware corporation, with offices located at 1121
Pacific Ave. Santa Cruz, CA 95060 and Predictive Systems Affiliates ("Predictive
Systems").
In consideration of the mutual covenants and promises set forth below, the
parties agree as follows:
1. Duties and Obligations.
1.1 Predictive Systems agrees to:
(a) perform the services ("Services") described in each written statement
signed by both parties (each a "Work Statement"). All Work Statements
shall state the Services to be provided, the applicable fee of
Predictive Systems and such other terms as the parties shall agree.
The initial Work Statement is set forth in Exhibit A hereto.
(b) perform additional services upon execution of subsequent Work
Statements by authorized representatives of both parties;
(c) provide adequate supervision, if applicable, to assure proper
performance of the Services in accordance with Exhibit A;
(d) keep Company advised of the progress of the Services by organizing
meetings between Company and Predictive Systems at mutually agreed
upon times and frequencies;
(e) permit any representative of Company to review from time to time the
results of the Services;
(f) provide Company with such deliverables, reports, specifications,
drawings, models, and the like, as are appropriate to the nature of
the Services and as specified in the appropriate Work Statement;
(g) keep records of work performed which Company may review from time to
time upon reasonable notice to Predictive Systems;
(h) ensure that Predictive Systems and its employees comply with
Company's safety, security and code of conduct regulations;
(i) ensure that Predictive Systems and its employees comply with Company's
requirements regarding, (i) Proprietary information & Invention
Agreement for Temporary Employees and Consultants, and
(ii) Authorization for Background Check;
(j) furnish personnel who are qualified to perform the Services;
(k) prior to using any subcontractor not an existing employee or
contractor of Predictive Systems, obtain Company's written approval of
use of such subcontractor;
(1) execute, for the benefit of Company, an agreement with any
subcontractor containing provisions of the character, scope and
purpose of this Agreement,
(m) ensure that any employee, contractor, or subcontractor of Predictive
Systems has the legal right to work in the United States at Company
and has obtained the proper immigrant status on the United States
Immigration and Naturalization Services Form I-9, or successor
documentation;
(n) maintain workers' compensation insurance coverage for employees,
contractors, or subcontractors of Predictive Systems; and
(o) comply with all reasonable instructions given by Company in connection
with the Services.
1.2 Each fully executed Work Statement is hereby incorporated in full into this
Agreement by reference and shall be subject to each of the terms and conditions
of this Agreement.
1.3 Company, may at its sole option and discretion, request the transfer or
replacement of any employee or subcontractor of Predictive Systems assigned to
perform the Services and Predictive Systems shall forthwith comply.
2. Representations and Warranties.
2.1 Predictive Systems represents and warrants that:
(a) Predictive Systems's performance of the Services and all terms of this
Agreement will not breach any agreement that Predictive Systems has,
or will have during the term of the Agreement, with another party and
there is no other contract or duty on his or her part now in existence
inconsistent with this Agreement;
(b) Predictive Systems has and will obtain non-disclosure, assignment of
rights and other appropriate agreements with its employees and
contractors, as applicable and necessary, sufficient to protect
Company's Confidential Information;
(c) to the extent that Predictive Systems's obligations hereunder have
been subcontracted, Predictive Systems shall remain fully responsible
for such obligations and will promptly pay any fees and/or charges due
to such Subcontractor;
(d) Services shall comply with Exhibit A;
Services are Year 2000 Compliant per Company's definition
available on the following web site: http//: www.ccisco.com; and,
(e) the Services will be performed in a professional workmanlike manner
consistent with industry standards.
2.2 WITHOUT LIMITING THE FOREGOING, PREDICTIVE SYSTEMS MAKES NO EXPRESS OR
IMPLIED REPRESENTATIONS WITH RESPECT TO ITS PERFORMANCE OF THE SERVICES
HEREUNDER OR ANY DELIVERABLES CONTEMPLATED HEREBY, INCLUDING WITHOUT LIMITATION
ANY REPRESENTATION OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
3. Confidentiality:
3.1 COMPANY expressly acknowledges that the performance of these services will
require Predictive Systems to gain access to COMPANY's confidential and
proprietary network and information assets, and authorizes this access for the
purposes described in the SOW, subject, however, to the Mutual Nondisclosure
Agreement, dated October 5, 1998, between COMPANY and Predictive Systems (the
"NDA").
3.2 By accepting Predictive Systems services, COMPANY assumes any and all
liability for any disclosure of any third-party confidential or proprietary
information assets, or any classified information, arising out of or resulting
from such Services, and agrees to indemnify, defend and hold harmless Predictive
Systems from and against any claim, loss or liability asserted by any person
arising out of or relating to any such disclosure, subject, however, to the NDA.
4. Indemnity.
4.1 Predictive Systems shall defend, and indemnify and hold Company harmless
from and against any and all claims, injuries, damages, obligations,
liabilities, causes of action, judgment or costs including reasonable attorneys'
fees, arising out of or in connection with, either directly or indirectly, any
intentional, negligent, fraudulent or criminal act or omission of Predictive
Systems or its subcontractors in the performance of any Services under this
Agreement, or any other act or omission by or under the direction of the
Predictive Systems or its employees, agents or subcontractors under this
Agreement.
4.2 Company shall defend, and indemnify and hold Predictive Systems harmless
from and against any and all claims, injuries, damages, obligations,
liabilities, causes of action, judgment or costs including reasonable attorneys'
fees, arising out of or in connection with Company's intentional, fraudulent or
criminal use or misuse of any deliverables resulting from Services provided to
Company by Predictive Systems under this agreement.
4.3 Notification. Company or Predictive Systems shall promptly notify each other
in writing of any claims subject to the indemnifications under Sections 4.1 and
4.2. In the event that any legal actions are taken, copies of all papers in
connection with such action shall be promptly forwarded to the respective party.
Neither party shall, if involved, incur any expenses or make any settlement
without the written consent of the other party.
5. Fees.
5.1 Predictive Systems shall be paid the fixed fees set forth in Exhibit A
attached hereto for Predictive Systems's performance of Services under this
Agreement, and Company will in no event be obligated to pay Predictive Systems
any more than the maximum fee amount stated in Exhibit A.
5.2 Predictive Systems shall submit to Company invoices detailing all the
Services rendered and, assuming timely and satisfactory completion of such
Services, Company shall pay such invoices within thirty (30) days of receipt of
invoice. Such fees are Predictive Systems's sole compensation for rendering
Services to Company. The parties agree that Company is not responsible to
reimburse any costs or expenses incurred by Predictive Systems in performing the
Services unless otherwise agreed to in the applicable Work Statement and/or
Exhibit A.
6. Term.
6.1 This Agreement will commence on the Effective Date and will continue until
the later of (i) December 31, 2000, or (ii) so long as a Work Statement (Exhibit
A) is in effect and has not been completed, unless terminated earlier as
provided in this Agreement ("Initial Term"). This Agreement shall renew month to
month after the Initial Term; provided that either party may prevent such
renewal, with or without cause, by giving the other party notice thirty (30)
days prior to the termination date of the Initial Term of the Agreement.
Termination. Company may terminate this Agreement, in whole or in part, for
convenience upon ten (10) days written notice to the Predictive Systems.
Immediately upon such notice, Predictive Systems will stop all work related to
this Agreement. Company shall pay Predictive Systems within thirty (30) days
receipt of invoice for all services rendered prior to notice of termination.
Further, notwithstanding anything to the contrary, this Agreement may be
terminated by either party for cause in the event of: (a) breach or default by
the other party of a material obligation under this Agreement which is not
remedied within thirty (30) days after written notice in accordance with Section
15; (b) a party files for bankruptcy or becomes an involuntary participant in a
bankruptcy proceeding, if such proceedings are not dismissed within sixty (60)
days after commencement; or, (c) notice of the inability of the other party to
perform due to the existence of an Excusable Delay event which is reasonably
determined by the terminating party to be a continuing condition; or (d) in the
event that any of the Predictive Systems's performance levels as set forth in
Exhibit A falls below ninety-five percent (95%) or falls below ninety percent
(90%) for three consecutive months, or any four (4) non-consecutive months
within a twelve-month period.
7. Insurance.
7.1 As an integral part of this Agreement and prior to initiation of work,
Predictive Systems shall deposit with Company's Risk Management Department
evidence of adequate insurance protection against fortuitous losses in the form
of certificates and/or endorsements (as applicable). The amounts shall be no
less than the amounts specified below, or such other amounts as specified in
advance in writing by Company's Risk Management Department:
(a) Workers' Compensation Insurance, in accordance with the provisions of
the laws or regulations of the nation, state, territory or province
having jurisdiction over Predictive Systems's employees, and
Employer's Liability insurance with a minimum limit of liability of
One Million Dollars ($1,000,000).
(b) Commercial General Liability Insurance, written on an "occurrence"
basis, including bodily injury, products/completed operations, broad
form property damage, blanket contractual liability, and contractor's
liability with a limit of liability not less than Two Million Dollars
($2,000,000) combined single limit per occurrence for bodily injury
and property damage and not less than Three Million Dollars
($3,000,000) general aggregate.
(c) Business Automobile Liability covering use of all owned, non-owned and
hired vehicles used in connection with the performance of this
Agreement with a limit of liability not less than One Million Dollars
($1,000,000) combined single limit per occurrence for bodily injury
and property damage.
(d) Professional Liability (Errors and Omissions) Insurance with limits of
liability of not less than One Million Dollars ($1,000,000) per
occurrence.
7.2 Waiver. Predictive Systems and its insurer(s) agree to waive all rights of
recovery or subrogation which Predictive Systems may have against Company,
except where prohibited by law. Such insurance shall substantially include the
following waiver of subrogation: Predictive Systems and its respective
underwriters hereby waive any and all rights of recovery by way of subrogation
or otherwise against Company, by reason of any loss, claim, action or payment
which might arise out of or in connection with the work performed under this
Agreement
7.3 Additional Insured. Certificates of insurance must include Company, its
subsidiaries, and their respective officers, directors, employees, and agents as
additional insureds for General Liability and Automobile Liability. All
certificates shall provide that the insurer give thirty (30) days written notice
to Company prior to any adverse material change in coverage, cancellation or
non-renewal of coverages. Said notice shall be submitted to Company's Risk
Management Department at 170 W. Tasman Drive, San Jose, CA 95134. Predictive
Systems's insurance is to be primary and shall contain cross liability and
severability of interest provisions, and any insurance carried by Company shall
be excess and non-contributing.
8. Consequential Damages: IN NO EVENT SHALL COMPANY OR PREDICTIVE SYSTEMS BE
LIABLE FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, INCIDENTAL, OR EXEMPLARY
DAMAGES INCLUDING WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS, COST
OF PROCUREMENT OF SUBSTITUTE GOODS, TECHNOLOGY OR SERVICES, BUSINESS
INTERRUPTIONS, OR LOSS OF INFORMATION, EVEN IF COMPANY OR PREDICTIVE SYSTEMS HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
9. Limitation of Liability. NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT OR
OTHERWISE, NEITHER PARTY WILL BE LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF
THIS AGREEMENT UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL
OR EQUITABLE THEORY FOR (I) ANY AMOUNTS IN EXCESS IN THE AGGREGATE OF THE FEES
PAID BY COMPANY TO PREDICTIVE SYSTEMS HEREUNDER DURING THE SIX (6) MONTH PERIOD
PRIOR TO THE DATE THE CAUSE OF ACTION AROSE, OR (II) ANY MATTER BEYOND SUCH
PARTY'S REASONABLE CONTROL.
10. Audit and Payment Adjustment. Predictive Systems agrees to maintain, in
accordance with generally accepted accounting principles, account records
necessary to disclose the basis for any charges, ordinary or extraordinary,
billed to Company under this Agreement, and shall make them available for
examination and audit by Company or its agents prior to, and for a period of two
(2) years after, receipt by Predictive Systems of final payment under this
Agreement. Company will have the right to audit such records during normal
business hours upon 72 hours notice to Predictive Systems.
11. Access. COMPANY expressly authorizes Predictive Systems to gain access,
including without limitation external network access, to COMPANY's computer
network and information systems which is reasonable and necessary for the
purposes described in the SOW, and COMPANY acknowledges that such access shall
be obtained by Predictive Systems with the express permission of COMPANY.
12. Restrictions Regarding Employees.
12.1 Restrictions Against Solicitation and Hiring. While this agreement is in
effect, and for a period of six months subsequent to the termination of this
agreement, neither Predictive Systems nor Company shall (i) solicit for
employment any of the other party's employees, without the prior written consent
of such other party or (ii) knowingly employ, either directly or indirectly (as
a consultant, independent contractor or otherwise), any of the other party's
employees; provided that any response by an employee of one party to any
advertisement of employment opportunities made by the other party targeted to
the general public shall not be deemed to be a breach of the foregoing
provision.
13.General.
13.1 Notice. Any notice to be given hereunder shall be in writing and addressed
to the applicable party at the address stated above, or such other address as
the party may designate from time to time by written notice in accordance with
this Section. Except as otherwise expressly provided in this Agreement, notices
hereunder shall be deemed given and effective (i) if personally delivered, upon
delivery, (ii) if sent by overnight rapid-delivery service with tracking
capabilities, upon receipt; (iii) if sent by telex, telecopier, or electronic
mail, at such time as the party that sent the notice receives confirmation of
receipt by the applicable method of transmittal, or (iv) if sent by certified or
registered United States mail, within five (5) days of deposit in the mail.
13.2 Severability. If any provision herein shall be held to be invalid or
unenforceable for any reason, such provisions shall, to the extent of such
invalidity or unenforceability, be of no force or effect, but without in any way
affecting the remainder of such provision or any other provision contained
herein, all of which shall continue in full force and effect.
13.3 Assignment. This Agreement shall be binding upon, and inure to the benefit
of, the parties hereto and their respective heirs, successors and assigns;
provided, however, that this Agreement and the rights and obligations hereunder
are not assignable by Predictive Systems without Company's prior written
consent.
13.4 Governing Law. This Agreement and all disputes and suits related thereto
shall be governed, construed, and interpreted in accordance with the laws of the
State of California without regard to conflicts of laws provisions thereof.
13.5 Compliance with Laws. Predictive Systems hereby represents and warrants
that (i) it shall comply with all applicable, local and national laws and
regulations; (ii) this Agreement and all of its terms are in full conformance
and in compliance with such laws; and (iii) it shall not act in any fashion or
take any action which will render Company liable for a violation of the U.S.
Foreign Corrupt Practices Act, which prohibits the offering, giving or promising
to offer or give, directly or indirectly, money or anything of value to any
official of a government, political party or instrumentality thereof in order to
assist it or Company in obtaining or retaining business or in caring out the
Services hereunder. Upon request, Predictive Systems agrees to issue
certificates certifying compliance with any of the aforementioned laws or
regulations as may be applicable to the Software and/or services being furnished
hereunder.
13.6 Independent Contractor. Predictive Systems hereby acknowledges and agrees
that it is an independent contractor to Company and is solely responsible for
all taxes, withholdings, and other similar statutory obligations. Predictive
Systems agrees to defend, indemnify and hold Company harmless from any and all
claims made by any entity on account of an alleged failure by Predictive Systems
to satisfy any such tax or withholding obligations. Predictive Systems
acknowledges and agrees that it is not an employee, agent, a joint venture, or a
partner of Company. Predictive Systems has no authority to act on behalf of or
to enter into any contract, incur any liability or make any representation on
behalf of Company. Predictive Systems will supply all tools and equipment
necessary to perform the Services unless otherwise agreed to in the Agreement.
13.7 Export Laws and Restrictions. Predictive Systems shall not transmit,
directly or indirectly, any Confidential Information or any technical data
received from or disclosed by Company, nor the direct product thereof, outside
the United States without Company's prior written consent and in accordance with
all export laws and regulations of the United States. Predictive Systems agrees
that it does not intend nor will it, directly or indirectly, export or re-export
any Confidential Information to anyone who Predictive Systems knows or has
reason to know will utilize it in the design, development or production of
nuclear, chemical or biological weapons or to anyone who has been prohibited
from participating in U.S. export transactions by any federal agency of the U.S.
Government.
13.8 No Waiver. No delay or failure by either party to exercise or enforce at
any time, any right or provision of this Agreement shall be considered a waiver
thereof or of such party's right thereafter to exercise or enforce each and
every right and provision of this Agreement. Any waiver of any right hereunder
in a specific circumstance shall not be deemed a waiver of that right in any
other circumstances or a waiver of any other right. A waiver to be valid shall
be in writing but need not be supported by consideration.
13.9 Counterparts. The Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which shall constitute but
one and the same instruments.
13.10 Excusable Delay. Neither party will be liable for any failure or delay in
performing any of its obligations under this Agreement, that is due to causes
beyond its reasonable control, such as natural catastrophes, governmental acts
or labor strikes or difficulties. Predictive Systems will notify Company
promptly of any factor, occurrence or event that comes to its attention that may
affect or delay Predictive Systems's ability to perform any of its other
obligations hereunder. By way of example, such notices shall be given in the
event of any loss or reassignment of key employees, threat of strike, knowledge
or any allegation that any technology used or to be used in performing
Predictive Systems' obligations would infringe on any third party's technology
rights, significant loss of data, or significant equipment failure.
13.11 Attorney Fees. The prevailing party in any legal action to enforce or
interpret this Agreement shall be entitled to recover reasonable attorney's fees
and costs.
13.12 Amendment. This Agreement may be amended or modified only with the prior
written consent of Authorized Representatives of both parties.
13.13 Entire Agreement. This Agreement and all schedules, exhibits and
attachments hereto constitute the entire agreement between the parties
concerning the subject matter hereof. This Agreement replaces and supersedes any
prior verbal or written understandings, communications, or representations
between the parties.
13.14. Survival. The following provisions shall survive termination or
expiration of this Agreement for whatever reason: Sections 3.1.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by
their duly authorized representatives as of the date written above:
Cisco Systems, Inc.
/s/ Perry V. Burke Purchasing Manager 8 Feb 2000
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Signature Title Date
Predictive Systems, Inc.
/s/ Marlene C. Bell
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Signature Title Date