Exhibit 10.36

 

MASTER SERVICES AGREEMENT

 

This Master Services Agreement by and between Rainmaker Systems, Inc.
(“Provider”), a corporation registered in Delaware and located at 1800 Green
Hills Road, Scotts Valley, California 95066, and Sony Electronics Inc., (“Sony”)
a Delaware corporation, located at One Sony Drive, Park Ridge, NJ 07656 is
effective as of April 22, 2004 (“Effective Date”). This Master Services
Agreement and its Schedules, Addenda, Exhibits, and Attachments, as so
identified, shall be hereinafter collectively referred to as the “Agreement.”

 

Whereas, Sony is a provider of consumer and professional A/V electronics and
entertainment products and services.

 

Whereas, Sony desires to engage Provider, and Provider desires to perform,
certain services with respect to Provider’s products and services, upon the
terms and conditions set forth herein.

 

1. INTRODUCTION

 

Following the Effective Date and during the term of this Agreement, Sony may
request Provider’s performance of certain sales, marketing and other services
(the “Outsource Services”), which Provider agrees to provide pursuant to a
mutually executed and agreed to statement of work (each an “SOW”). The terms and
conditions of this Agreement shall apply to all SOWs. In the event of a conflict
between the terms of this Agreement and any SOW, the terms of this Agreement
shall prevail and such conflicting terms shall be deemed null and void. Sony
hereby expressly authorizes Provider, during the term of this Agreement, to
contact Sony’s customers on the basis of and in furtherance of Sony’s
established business relationship with its customers, in accordance with the
applicable SOW. For purposes of this Agreement, the following terms shall have
the following meanings: (i) “Business Day” means any day other than Saturday,
Sunday, or any nationally recognized holiday in the United States; (ii) “Sony”
means Sony and any of its affiliates; (iii) “Sony Data” means proprietary Sony
data furnished to Provider by Sony; (iv) “Customer” means any entity that has
purchased or licensed, or prospectively will purchase or license, a Product from
Sony; (v) “Deliverable” means any work product identified to be delivered by
Provider to Sony under an SOW; (vi) “Product” means any product or service that
Sony offers to its Customers.

 

2. TERM

 

Unless earlier terminated under Section 9.1 below, Provider agrees to offer its
Outsource Services to Sony for a period of three (3) years. Thereafter, this
Agreement shall automatically renew for additional successive one (1) year terms
unless either party provides notice of its desire not to continue this Agreement
for such additional one (1) year term at least sixty (60) days prior to the end
of the then relevant term.

 

3. PERFORMANCE

 

Except as set forth in Section 6 below, Provider shall provide to Sony the
Outsource Services in the time and manner specified in the relevant SOW.

 

4. PAYMENT & TAXES

 

4.1 As full and complete consideration for the Outsource Services to be
performed by Provider, and for the rights granted/assigned herein, Sony shall
pay Provider such fees and other compensation as are set forth on the applicable
SOW (the “Fees”). Fees invoiced shall be invoiced in the manner specified in the
applicable SOW and Provider shall submit such invoices in a manner that conforms
to Sony’s reasonable requirements. Sony shall have no obligation to pay any
invoice submitted more than *** days from when such invoices should have been
issued according to the applicable SOW. Sony shall pay undisputed invoices
within *** days of Sony’s receipt of such invoice. Any of the Fees payable on a
per diem/per hour basis are only for those days/hours actually worked by
Provider. Payment of the Fees is subject to completion of the Outsource Services
covered thereby to the reasonable satisfaction of Sony. ***. Sony shall
reimburse Provider for reasonable pre-authorized travel and lodging expenses
incurred in connection with performance of the Outsource Services. Such expenses
must either be set forth on the applicable SOW or approved in advance by Sony.
Reimbursement shall be conditioned upon providing Sony with itemized receipts
and supporting documentation submitted in accordance with Sony’s instructions.
All air travel shall be coach class unless approved in advance by an authorized
representative of Sony.

 

4.2 If Provider determines that it has any inquiries, problems or believes there
are errors or discrepancies with respect to any amounts due pursuant to this
Agreement, Provider shall give Sony written notice thereof within *** days from
the date that the Outsource Services which gave rise to the inquiry, problem
and/or discrepancy, etc. were performed. Provider’s failure to give Sony such
notice or Provider’s failure to invoice Sony for any Service or expense within
*** days after such Service is performed or expense is incurred shall constitute
a waiver of any and all rights which Provider may have to any payment,
adjustment, charge or reimbursement by reason thereof.

 

4.3 US Dollars: All payments shall be stated (and payments made) in United
States dollars and are exclusive of applicable sales, use or similar taxes.

 

4.4 Payment Terms: Except as set forth below and as may otherwise be set forth
in an SOW, all amounts owed by either party to the other hereunder shall be due
and payable within *** days, and shall be net of amounts returned by Customers.

 

4.5 Tax Withholdings: Each party acknowledges and agrees that the other party
has the right to withhold any applicable taxes from any royalties or other
payments due under this Agreement if required by any government authority.
Without limiting the foregoing, if Sony is purchasing products/services from
Provider on behalf of a

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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subsidiary or affiliate of Sony, Provider acknowledges and agrees that Sony may
withhold from any royalties or payments due for such products/services any
applicable taxes incurred by Sony that result from Sony providing such
products/services to the applicable Sony subsidiary or affiliate.

 

4.6 Tax Liability: Notwithstanding the terms of Section 4.5 above, each Party
shall be solely responsible for its own taxes, including, without limitation,
income, franchise, property, sales, use and value added taxes, assessments,
other similar tax-like charges, and tax-related surcharges which may be required
or imposed by any federal, state, or local taxing authority.

 

5. DELIVERABLES

 

Sony’s acceptance of any Deliverable shall be as set forth in the applicable
SOW.

 

All products, data, business plans, information, specifications, drawings, or
other Sony property furnished by Sony to Provider (the “Sony Property”) shall
remain the exclusive property of Sony. Such Sony Property will be used for no
purpose other than the performance of the Outsource Services. If requested by
Sony, Provider shall sign and deliver a written itemized receipt or loan
agreement for all such Sony Property and shall be responsible for its
safekeeping. Upon termination or expiration of this Agreement, all Sony Property
shall be immediately returned to Sony.

 

6. LIMITED WARRANTY & REPRESENTATIONS & WARRANTIES.

 

6.1 Outsource Services: Provider represents and warrants to Sony that the
Outsource Services shall be performed in a professional, and workmanlike manner
in accordance with the requirements of this Agreement and the requirements and
time schedules of any applicable SOW in all material respects, and in accordance
with any applicable commercial standards generally observed in the industry for
similar professional services. Provider further represents and warrants to Sony
that the performance of the Outsource Services by Provider shall not violate any
proprietary rights of third parties, including, without limitation, patents,
copyrights or trade secrets, and that Provider’s rendering of the Outsource
Services to Sony under this Agreement shall not violate any applicable law,
rule, regulation or judicial order, or violate any contractual obligations or
confidential relationships which Provider may have to or with any third party.

 

6.2 Deliverables: Except as may otherwise be set forth in an SOW, Provider
warrants that Outsource Services shall be free of defects in material and
workmanship and shall conform to the applicable specifications therefor.

 

6.3 REMEDY:

 

6.3.1 Outsource Services. In the event Provider breaches the warranty under
Section 6.1 above, Provider shall re-perform the relevant portion of the
Outsource Services to conform with Section 6.1 in all respects.

 

6.3.2 Deliverables. In the event Sony notifies Provider during the Warranty
Period of a Deliverable’s breach of the warranty under Section 6.2, Provider
agrees to either repair or replace such Deliverable to conform with Section 6.2
in all respects.

 

6.3.3 SOLE REMEDY. THE FOREGOING SECTION 6.3 STATES PROVIDER’S ENTIRE OBLIGATION
AND LIABILITY AND SONY’S SOLE AND EXCLUSIVE REMEDY FOR BREACH OF WARRANTY UNDER
SECTIONS 6.1 AND 6.2.

 

6.4. Mutual Representations of the Parties: Each party hereby represents and
warrants to the other that:

 

6.4.1. Authority. It has full power and authority to enter into this Agreement
and to perform its obligations hereunder.

 

6.4.2. No Claims. There is no action, suit, proceeding, or material claim or
investigation pending or threatened against such party in any court, or before
any governmental department, commission, agency, or the like, or before any
arbitrator which, if adversely determined, might adversely affect such party’s
ability to fulfill its obligations or exercise the rights granted hereunder.

 

6.4.3. No Conflict. Performance of this Agreement shall not violate any
governmental laws, rules, ordinances, or regulations (including without
limitation all applicable import or export regulations and all licensing or
permitting requirements), or breach any other Agreement in which either party is
bound.

 

6.5 Sony Data: Sony represents and warrants that it has all necessary rights,
licenses and permissions to furnish Provider with and to authorize Provider’s
use of the Sony Data in connection with the performance of the Outsource
Services.

 

6.6 NO OTHER WARRANTIES: EXCEPT AS SET FORTH IN THIS SECTION 6, NEITHER PARTY
MAKES ANY WARRANTIES TO THE OTHER WITH RESPECT TO THE OUTSOURCE SERVICES,
DELIVERABLES OR OTHER SUBJECT MATTER OF THIS AGREEMENT AND EACH PARTY HEREBY
EXCLUDES ALL OTHER WARRANTIES WHETHER STATUTORY, EXPRESS, IMPLIED OR OTHERWISE,
INCLUDING, WITHOUT LIMITATION, ANY AND ALL WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, TITLE, ACCURACY, AND INFRINGEMENT. PROVIDER
MAKES NO REPRESENTATIONS OR WARRANTIES REGARDING SONY’S USE OR RESULTS OBTAINED
FROM USE OF THE OUTSOURCED SERVICES OR DELIVERABLES.

 

7. INDEMNIFICATION

 

7.1 Scope and Process: Each party shall defend, indemnify, and hold the other
party harmless from and against any and all claims, injuries, damages,
obligations, liabilities, causes of action, judgments and costs, including
reasonable attorneys’ fees and court costs, arising out of or in connection with
(i) such party’s breach of the warranties set forth in Section 6 above, (ii) any
reckless, intentional,

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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fraudulent or criminal act of such party or of any director, officer, employee,
agent, or third party subcontractor of such party, (iii) claims by Customers
based on (a), with respect to Provider, Provider’s representations or warranties
to Customers other than those that Sony provides with the applicable type of
“Service Contract” as set forth in an SOW, or (b) with respect to Sony, Sony’s
representations and warranties, or breach thereof, that Sony makes to any
Customer in respect of any “Service Contract” as set forth in an SOW or
otherwise, or (iv) claims by or on behalf of either parties’ subcontractors,
suppliers or employees for salary, wages, benefits or other compensation. The
party claiming indemnification under this section (“Claiming Party”) shall
notify the other party (“Indemnifying Party”) promptly and in writing of any
claims subject to indemnification under this Section 7, and the Indemnifying
Party shall have sole control of the defense, settlement, or trial thereof. The
Claiming Party shall provide to Indemnifying Party, at Indemnifying Party’s
request and expense, all reasonable assistance and all information reasonably
available to Claiming Party for such defense. If Sony is prevented from using or
otherwise enjoying the benefit of any Outsource Services, in whole or in part,
as a result of any allegation of infringement of third party propriety rights,
including but not limited to patents, copyrights, or trade secrets, Provider
shall promptly, at its sole expense (including, if applicable, the expense of
implementation and systems integration): (i) procure for Sony the right to
continue using the Outsource Services or Deliverables in the same manner as Sony
previously used such Outsource Services or (ii) modify or replace the infringing
portion of the Outsource Services or Deliverables so it becomes non-infringing
yet remains functionally and operationally equivalent.

 

7.2 SOLE REMEDY: THE FOREGOING STATES EACH PARTY’S SOLE AND EXCLUSIVE OBLIGATION
AND EACH PARTY’S SOLE AND EXCLUSIVE LIABILITY WITH RESPECT TO CLAIMS SUBJECT TO
INDEMNIFICATION UNDER SECTION 7.1 ABOVE.

 

8. LIMITATION OF LIABILITY AND ON DAMAGES.

 

8.1 TOTAL LIABILITY: IN NO EVENT SHALL EITHER PARTY’S TOTAL CUMULATIVE LIABILITY
HEREUNDER EXCEED THE NET AMOUNTS RECEIVED BY PROVIDER UNDER ANY SOW(S) DURING
THE TWELVE MONTHS PRECEDING THE EVENT GIVING RISE TO LIABILITY UNDER SUCH
SOW(S). THE FOREGOING LIMITATION SHALL NOT APPLY TO AMOUNTS FOR WHICH EITHER
PARTY IS LIABLE TO THE OTHER PARTY (A) FOR PERSONAL INJURY TO OR DAMAGE TO
TANGIBLE PROPERTY OF EITHER PARTY CAUSED BY THE OTHER PARTY, OR (B) UNDER
SECTION 7 ABOVE PROVIDED THAT IN NO EVENT SHALL EITHER PARTY’S TOTAL CUMULATIVE
LIABILITY UNDER SECTION 7 EXCEED AN AMOUNT OF 1 MILLION DOLLARS. THE FOREGOING
LIMITATIONS SHALL APPLY REGARDLESS OF THE THEORY OF RECOVERY INCLUDING BREACH OF
CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY) OR BASED ON THE
FAILURE OF ESSENTIAL PURPOSE OF ANY REMEDY. THE FOREGOING LIMITATIONS SHALL
APPLY TO THE MAXIMUM EXTENT PERMITTED UNDER LAW.

 

8.2 NO INDIRECT DAMAGES: EXCEPT WITH RESPECT TO AMOUNTS FOR WHICH EITHER PARTY
IS LIABLE UNDER SECTION 7 ABOVE, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR
ANY (A) COST OF COVER OR SUBSTITUTE GOODS OR SERVICES OR (B) ANY SPECIAL,
INDIRECT, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR EXEMPLARY DAMAGES, INCLUDING
BUT NOT LIMITED TO ANY DAMAGES FOR LOST PROFITS, BUSINESS INTERRUPTIONS, LOSS OF
DATA OR OTHERWISE, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES. THE FOREGOING LIMITATIONS SHALL APPLY TO THE MAXIMUM EXTENT
PERMITTED UNDER LAW.

 

9. TERMINATION

 

9.1 Cause: Either party may terminate this Agreement upon written notice to the
other in the event of a breach of any material obligation hereunder by such
other party which is not cured within thirty (30) days of written notice of such
breach having been given to such other party.

 

9.2 Effect of Termination: In the event of termination under Section 9.1, each
SOW executed between the parties shall terminate on the effective date of
termination of this Agreement and Sony shall promptly pay, but in no event more
than thirty (30) days after the effective date of termination, Provider for the
Outsource Services and Deliverables, or portion thereof, properly performed up
through the effective date of termination. Termination under Section 9.1 shall
not be construed to be an election of remedies or a waiver thereof.

 

9.3 Bankruptcy, etc.: Either party may immediately terminate this Agreement by
giving written notice to the other party if the other party is insolvent or has
a petition brought by or against it under the insolvency laws of any
jurisdiction; if the other party makes an assignment for the benefit of
creditors; if a receiver, trustee or similar agent is appointed with respect to
any property or business of Sony.

 

9.4 For Convenience: Any other provision of this Agreement notwithstanding,
either Party shall have the right, within its sole discretion, to terminate the
Agreement or any applicable SOW without further liability hereunder for any
reason whatsoever upon ninety (90) days prior written notice to the other Party,
except that, no notice For Convenience shall be served by Sony within the first
90 days from the Effective Date. In such event, each Party shall be liable to
the other Party for fees earned and expenses incurred for the Services properly
performed prior to such notice. Provider understands, acknowledges, and agrees
that Sony shall not under any circumstances be liable for, or pay, any
Implementation Fees or Start-up Fees waived by Provider.

 

10. INTELLECTUAL PROPERTY RIGHTS

 

10.1 Existing Intellectual Property: Each party hereby retains and shall own all
right, title and interest in and to their respective Existing Intellectual
Property. For purposes of this Agreement, the term “Existing Intellectual
Property” means any and all technology, know how, show how, software, data,
ideas, formulae, processes, charts, Confidential Information and any other
materials or information and any and all worldwide intellectual property rights
therein and thereto (a) owned or controlled by either

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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party on the Effective Date or (b) developed by either party outside the scope
of this Agreement and which does not rely or use (i) the other party’s Existing
Intellectual Property or (ii) Confidential Information.

 

10.2 No Other License: Except as set forth in this Agreement, including as may
be provided in any SOW with respect to any Deliverable, neither party shall be
deemed to have any license with respect to the other party’s Existing
Intellectual Property hereunder and each party reserves all rights therein and
thereto not so granted.

 

10.3 Sony Marks: Provider hereby acknowledges and agrees that (i) any license to
use any Sony Marks shall be as set forth in an SOW and shall be limited to
Provider’s performance of the relevant SOW; (ii) the Sony Marks are owned solely
and exclusively by Sony, (ii) except for any license grant in an SOW, Provider
has no right, title or interest in or to the Sony Marks and (iii) all use of the
Sony Marks by Provider shall inure to the benefit of Sony. Provider agrees not
to apply for registration of the Sony Marks (or any mark confusingly similar
thereto) anywhere in the world.

 

10.4 Proprietary Notices: Provider agrees not to alter or remove any logo,
insignia, copyright notice, trademark notice or other proprietary notice on or
in any Product.

 

11. GENERAL

 

11.1 Disputes: Before initiating a lawsuit against the other relating to a
dispute or claim herein, Sony and Provider agree to first work in good faith to
resolve between themselves such dispute or claim arising out of or relating to
this Agreement. To this end, either party may request that each party designate
an officer or other management employee with authority to bind the party to meet
to resolve the dispute or claim. If, after meeting, the parties are still unable
to resolve the dispute or claim, then the parties agree to submit the matter to
mandatory mediation. During this resolution process, each party shall honor the
other’s reasonable requests for non-privileged and relevant information. This
paragraph shall not apply if: (i) the expiration of the statute of limitations
for a cause of action is imminent; or (ii) injunctive or other equitable relief
is necessary to mitigate damages.

 

11.2 Excusable Delay: Neither party shall be liable for any failure or delay in
performing any of its obligations under this Agreement due to any Act of God,
fire, casualty, flood, war, strike, lockout, epidemic, destruction of production
facilities, riot, or insurrection. Each party hereby excludes the application of
this Section 11.2 from the obligation to make payments hereunder.

 

11.3 Survival of Terms: Regardless of the circumstances of termination or
expiration of this Agreement or any SOW, the provisions of Sections 6
(“Warranty”), 7 (“Indemnification”), 8 (“Limitation of Liability”), 10
(“Intellectual Property Rights”) and 11 (“General”) shall survive the
termination or expiration and continue according to their terms.

 

11.4 Confidentiality: Any confidential information that will be disclosed by
either party related to this Agreement shall be disclosed pursuant to the terms
and conditions of the Sony Non-disclosure Agreement Dated Nov.7, 2003 between
Sony and Provider (“Confidential Information”); provided that the scope of use
of such Confidential Information shall be deemed expanded to cover provision and
receipt of Outsource Services and Deliverables as contemplated hereunder.

 

11.5 Publicity: Sony hereby consents to the use and publication of its name,
trademarks and corporate logos by Provider solely for use for specific
performance under this Agreement or SOW. In addition, except as required by law,
neither party shall issue any press release, announcement or other public
disclosure relating to the subject matter of this Agreement without the prior
written approval of the other party. Such consent shall not be unreasonably
withheld. Sony reserves the right to (A) review in advance of publication or
distribution any and all sales, marketing and other materials which incorporate
Sony’s name, trademarks or corporate logos, and (B) disapprove the use of such
materials if Sony determines, in its sole and absolute discretion, that such
materials or Provider’s use of such materials are objectionable or otherwise
unsuitable.

 

11.6 Insurance: Provider shall obtain and at all times during the term of this
Agreement maintain at its own expense, with insurance companies acceptable to
Sony, the minimum insurance coverage stated in Exhibit A to this Agreement.

 

11.7 Records & Audit: Provider shall maintain accurate and legible records,
including but not limited to accounting records, related to the Outsource
Services in English during the term of this Agreement and for a period of not
less than three (3) years thereafter or that period prescribed by applicable law
or regulation. During the foregoing period, Sony shall have the right, not more
than once per six (6) month period, upon at least seven (7) Business Day’s
written notice thereof to Provider, to conduct, at its sole expense and during
the normal business hours of Provider, an audit of such records through an
independent third party auditor, other than on a contingent fee basis, to verify
Provider’s payment and/or remittance of amounts due under this Agreement. Sony
shall use reasonable efforts to not disrupt or impede Provider’s business
operations in the course of conducting any such audit.

 

11.8 Independent Contractors: The parties shall be deemed for all purposes to be
independent contractors. Nothing in this Agreement or in the activities
contemplated by the parties pursuant to this Agreement shall be deemed to create
an agency, partnership, employment or joint venture relationship between the
parties. Each party shall be deemed to be acting solely on its own behalf and,
except as expressly stated, neither party shall have the right or authority to
bind or incur any liability or obligation of any kind on behalf of the other.
Provider shall be solely responsible for all materials and work until Acceptance
by Sony, and Sony shall have no direction (except in the results to be obtained)
or control of Provider, or any person employed by or contracted for by Provider.

 

11.9 Amendments; Waivers: No waiver of any term or condition is valid unless in
writing and signed by authorized representatives of both parties, and shall be
limited to the specific situation for which it is given. No amendment or
modification to this Agreement shall be valid unless set forth in writing and
signed by authorized representatives of both parties.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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11.10 Governing Law: This agreement shall be governed by and construed in
accordance with the laws of the State of California, exclusive of any provisions
of the United Nations convention on the international sale of goods and without
regard to principles of conflicts of law. Each party hereby irrevocably submits
to the exclusive jurisdiction of the Federal and State Courts located in the
County of Santa Clara, California, USA and hereby agrees that any such court
shall be a proper forum for the determination of any dispute arising hereunder.

 

11.11 Notices: All notices permitted or required to be given under this
Agreement shall be in writing and delivered to the parties at their respective
addresses set forth below by (i) hand delivery, (ii) nationally recognized
overnight courier (with tracking and receipt verification capabilities), (iii)
certified or registered mail, postage prepaid, (iv) regular mail, or (v)
facsimile transmission with a confirmation of receipt. Any such notice shall be
deemed to be effective on the earlier of (a) the day of delivery by hand or
overnight courier, (b) the day of transmission if sent by facsimile, (c) three
days after mailing if sent by mail or courier in the manner set forth above, or
(d) upon receipt:

 

If to Sony:

Sony Electronics Inc.

One Sony Drive

Park Ridge, NJ 07656

Attention: ***

Telephone: ***

 

If to Provider:

Rainmaker Systems, Inc.

1800 Green Hills Road

Scotts Valley, CA 95066

Attention: ***

Telephone: ***

Facsimile: ***

 

With a copy to:

N/A

 

Each party may change its respective address or facsimile number by submitting
written notice to the other party in accordance with this paragraph.

 

11.12 Severance: Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement is found to violate a law, it shall be
severed from the rest of the Agreement and ignored and a new provision deemed
added to this Agreement to accomplish to the extent possible, the intent of the
parties as evidenced by the provision so severed. The headings used in this
Agreement have no legal effect.

 

11.13 Non-Exclusive: Nothing in this Agreement shall require Sony to purchase
from Provider all of its requirements for services that are the same or similar
to the Outsource Services provided hereunder, and Sony may purchase similar or
identical services from others. Similarly, Nothing in this Agreement shall
preclude or limit provision of services similar to the Outsource Services to
third parties, subject to the security and non-disclosure obligations set forth
herein.

 

11.14 Third Party Contractors: Provider shall be free to use third party
contractors in the provision of the Outsource Services and/or Deliverables to
Sony hereunder, provided that Provider shall remain directly liable to Sony
under this Agreement with respect to any Outsource Services performed and/or
Deliverables delivered though the use of any such third party subcontractors or
agents.

 

11.15 Assignment: This Agreement may not be assigned by either party without the
prior written consent of the other party, such consent not to be unreasonably
withheld or delayed. Notwithstanding the foregoing, each party may assign this
agreement by operation of law or otherwise in the context of a merger or stock
or asset sale, without such prior written consent. Any attempted assignment
contrary to the preceding shall be null and void. Subject to the foregoing, this
Agreement shall inure to the benefit of each party’s permitted successors and
assigns.

 

11.16 Entire Agreement: This Agreement, the NDA referenced in this Agreement and
each SOW and each of their respective attached Addenda, Exhibits, Attachments,
and Schedules, as so designated, set forth the entire agreement and
understanding of the parties relating to the subject matter contained herein,
and merges all prior discussions and agreements, both oral and written, between
the parties. Each party agrees that use of pre-printed forms, including, but not
limited to email, purchase orders, acknowledgements or invoices, is for
convenience only and all pre-printed terms and conditions stated thereon, except
as specifically set forth in this Agreement, are void and of no effect. Unless
otherwise expressly set forth in an SOW, as so designated, in the event of
conflict between this Master Services Agreement and any SOW, the terms of this
Master Services Agreement shall prevail.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized representatives as of the day and year first written
herein.

 

Sony Electronics Inc.:   Rainmaker Systems, Inc.:

By:

 

/s/ Dan P. Wirrsma

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By:

 

/s/ Martin Hernandez

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Printed Name:

 

Dan P. Wirrsma

 

Printed Name:

 

Martin Hernandez

Title:

 

SVP

 

Title:

 

President

Date:

 

4/21/04

 

Date:

 

4/21/04

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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EXHIBIT A

Insurance Requirements

 

In performance of the obligations under this Agreement, Provider agrees to
comply with the following provisions regarding insurance coverage:

 

1. Provider shall obtain and at all times during the term of this Agreement
maintain at its own expense, with insurance companies rated “A” or better by AM
Best, the minimum insurance coverages set forth below.

 

2. Statutory workers compensation insurance in the state(s) or jurisdiction in
which Provider’s employees perform services for Sony, and employer’s liability
insurance with limits of not less than $***: (i) for each accident; and (ii) for
each employee for occupational disease; or (iii) policy limit for disease.

 

3. Commercial General Liability insurance with limits for bodily injury and
property damage liability of not less than $*** personal injury each occurrence,
$*** general aggregate and products/completed operations coverage which shall
include premises/operations liability, independent contractors liability, and
broad form contractual liability specifically in support of, but not limited to,
the indemnity provisions set forth in this Agreement.

 

4. Business automobile liability insurance with a limit of not less than $***
per occurrence for bodily injury and property damage liability written to cover
all owned, hired and non-owned automobiles arising out of the use thereof by or
on behalf of the Provider and its employees.

 

5. Employee Dishonesty Insurance shall be procured, with blanket limits of at
least $***.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.

 

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RAINMAKER SERVICES SALES, INC.

STATEMENT OF WORK

 

This Statement of Work (“SOW”) is subject to the terms and conditions of the
Master Services Agreement (the “Agreement”) between Rainmaker Services Sales,
Inc. (“Provider”) and Sony Electronics Inc. (“Sony”) effective as of April 22,
2004.

 

WHEREAS, Provider agrees to perform, and Sony desires to receive, the certain
sales and marketing functions with respect to such Products set forth under this
SOW.

 

NOW, THEREFOR, THE PARTIES AGREE AS FOLLOWS:

 

Capitalized terms not specifically defined herein shall have the meaning set
forth in the Agreement.

 

MSA & Entire Agreement

 

The terms and conditions of this SOW are hereby incorporated in their entirety
into the Agreement and set forth the entire agreement and understanding of the
parties relating to the subject matter contained herein, and merges all prior
discussions and agreements, both oral and written, between the parties. In the
event of a conflict between the terms of this SOW and the terms of the
Agreement, the terms of the Agreement shall prevail and such conflicting terms
shall be deemed null and void.

 

License to Use Client Marks

 

Subject to the terms and conditions hereof, Sony hereby grants to Provider a
nonexclusive, non-sublicensable and royalty-free license to use any trademark(s)
or service mark(s) approved by Sony (“Client Marks”) in providing the Outsourced
Services, including (1) to take, handle and fulfill Customer orders for
Products, and (2) to market and sell the Products hereunder.

 

Use and Display of Client Marks

 

All materials in which Provider presents a trademark or service mark shall be in
a form that complies with Sony usage requirements. These Client Marks include
and are not limited to:

 

“SupportNETSM” is a registered service mark of Sony Electronics Inc.

 

“SystemWatchSM” is a registered service mark of Sony Electronics Inc.

 

“ServicesPLUSSM” is a registered service mark of Sony Electronics Inc.

 

Doing Business As (“DBA”)

 

Provider and Sony shall mutually agree to a DBA name to be utilized by Provider
to provide the Order Processing Services, within five (5) Business Days of the
Effective Date.

 

Term/Suspension/Termination

 

The term of this sow shall be for three (3) years from the Effective Date
hereof. Either party may terminate this SOW upon at least ninety (90) days prior
written notice to the other party, except that no notice shall be served by
Sony, except for breach, within the first 90 days from the Effective Date.
Thereafter, this SOW shall automatically renew for additional successive one (1)
year terms unless either party provides notice of its desire not to continue
this SOW for such additional one (1) year term at least thirty (30) days prior
to the end of the then relevant term. In addition to the foregoing, this SOW
shall immediately terminate upon the effective date of termination of the
Agreement.

 

Post Termination Deliverables

 

Upon the termination or expiration of this Agreement for any reason, Provider
shall promptly deliver to Sony or its designee all documents, and all media or
items containing, in whole or part, any Confidential Information of Sony and any
other materials, information or other items delivered by Sony to Provider
hereunder (“Sony Materials”). Provider shall retain a copy of all Sony Materials
only for so long as retention of such records is required under applicable
federal and state tax reporting purposes or under other applicable governmental
rules

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

1

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or regulations (provided that the Sony Materials shall be subject to, and
Provider shall fully comply with, the terms and conditions of the Sony
Non-disclosure Agreement Dated November 7, 2003 between Sony and Provider),
after which any such copies shall be returned to Sony or destroyed at Sony’s
request.

 

Change Management

 

Sony may at any time provide written notice of modification to the Scope of
Outsource Services to Provider. Said notice shall describe the requested
modifications in detail sufficient to permit Provider to submit to Sony, within
ten (10) Business Days following receipt of notice, an estimate of any
additional cost (or cost reduction) to Sony and/or schedule impact to effect the
modifications. Provider shall implement the modifications only upon prior
written authorization from Sony. In this case, modifications refer to reporting
and other minor enhancements to support the business relationship. It does not
refer to fundamental changes in offerings or significant changes to tools.

 

I. Definition of Terms

 

•      “Business Day” means any day other than Saturday, Sunday, or any
nationally recognized or holiday.

•      “Customer” refers to an end-user customer of Sony.

•      “Effective Date” is the date both parties sign the SOW.

•      “Launch Date” is the date Rainmaker begins communications to or with Sony
Customers.

•      “Outsourced Services” means those services that Rainmaker shall provide
for or on behalf of Sony as set forth in SOW(s) under the Agreement.

•      “Product” means any product or service that Sony offers to its Customers.
The types of Products to be offered by Rainmaker may be set forth in one or more
SOW(s) under the Agreement.

•      “Programs” mean the specific offers to “Target Market” as defined in the
SOW

•      “Target Market” means the customer segment to which Rainmaker may perform
sales and marketing services with respect to the Programs, as set forth in the
SOW.

•      “Business Rules” mean rules of engagement that are defined in cooperation
with both Sony and Provider, which shall govern the day-to-day administration of
this Agreement and the parties’ relationship hereunder.

•      “Up – Sell” or “Upgrades” means selling a higher level of service to an
existing service customer.

•      “Extension” means extending the same level of service for additional
year(s) upon service expiration, to existing service Customers.

•      “IRIS” means Sony Electronics entitlement system

 

II. Scope of Outsource Services

 

  A. Configurator

 

Services outlined in this SOW require the use of a pricing configurator.
Provider shall create the Sony services pricing configurator, integrate it into
Provider’s web quoting tools and Sony sales representative pricing and quoting
tool as well as Provider’s internal sales and marketing systems and maintain the
configurator by updating pricing and product changes as agreed in the business
rules.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

2

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The configurator shall define product families, service level & price of service
for Products and Extensions. The configurator shall contain all data required
for the specified Programs.

 

  B. Data and System Integration

 

Upon contract execution, Rainmaker shall begin integration of Contract Renewals
Plus (CRP SM) services for Sony. The objective of the integration is to create a
transparent extension of Sony for the purpose of sales and marketing of Sony
Products as outlined in this SOW. Contract Renewals Plus integration shall
include:

 

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

•      ***

 

Rainmaker shall provide an integration team to work closely with Sony during the
integration process and “launch” transition period. The Rainmaker team shall
ensure a smooth integration with minimal disruption to Sony’s daily operations.

 

  C. Marketing and Sales Programs

 

Sony shall leverage Provider’s people, process and technology through Contract
Renewals Plus, CRP SM (Provider’s integrated solution for renewing technology
service contracts and up-selling or attaching other service offers).

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

3

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Provider shall create a transparent extension of Sony using a team of sales and
marketing professionals, and leverage Provider’s web and infrastructure
technology and process expertise.

 

Sales Programs

 

Contract Reactivation Program

 

Contract reactivation programs pursue customers who have had a service contract
in the past, which has already expired. We target these customers for immediate
communication with the objective of bringing as many back onto contract as
possible. Reactivation opportunities are generally looked at going back 12
months.

 

Contract Renewals Program

 

Contract renewals programs target customers who have active in-warranty uplift
agreements, extended warranty or actual service contracts, which are coming up
for renewal within the next 12 months.

 

Warranty Conversions

 

Customers still within their original warranty period who wish to purchase an
extended warranty.

 

In Warranty Up-lift and Attach – Non-embedded service sales

 

This program targets customers fitting criteria for targeted offers based on the
current asset base or company profile. These programs are most successful soon
after the point of sale or with at least half the warranty period remaining.

 

Up-Sell Embedded Services Sales

 

All embedded services shall be targeted for entitlement registration. As with
the warranty uplift program discussed above, this program targets specific
customers based on the product or products purchased and offers services more
suitable for the usage and environment in which the product is being used. This
data should be provided to Rainmaker in regularly scheduled automated weekly
data feeds.

 

Renewing Embedded Services

 

All embedded services sold by Sony and entitled within IRIS, or sold and
registered through a reseller are eligible for renewal upon expiration. All
embedded services data should be loaded into Rainmaker’s systems for timely
targeted communications – Rainmaker shall market to these customers 120 days
prior to expiration.

 

Targeted Offers (Sony System Monitoring Solutions)

 

Rainmaker welcomes the opportunity to create program specific campaigns to
create awareness and generate sales for premium service offerings to Sony
customers. One such product is Sony System Monitoring Solutions, which once
again, is targeted to eligible customers who would benefit specifically by
having this service.

 

Bi-Directional Lead Generation Activities

 

Rainmaker encourages the transfer of “warm” technical support leads to Rainmaker
from Sony. These are opportunities for selling service that are discovered
either through Sony’s Direct Equipment Sales or Service Operations organization.
Inquiries about new product sales or questions about new equipment pricing shall
immediately be forwarded or transferred to a designated Sony Direct Equipment
Sales Account Managers. The parties shall establish specifically defined
relationships between Provider’s sales personnel and Sony’s Direct Equipment
Sales Account Managers (for equipment sales). These relationships shall generate
additional product and service lead volume and sales with the larger Sony
customers.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

4

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Data provided by Sony to Provider for the Programs listed in this SOW (the
Programs) constitutes opportunities that are exclusive for Provider to pursue.
Sony agrees that there shall be no conflicting programs conducted by Sony or
Sony’s sales teams for the Programs. The parties shall standardize service
programs and their sale through the Provider.

 

Commissions and Processing Fees

 

Provider shall be entitled to commission and processing fees defined in MIII
below for any sale it makes to Sony Customers for which the Provider was the
lead sales agent. For sales credited to Sony Direct Equipment Sales or
Professional Services Sales Representatives, Provider shall be entitled to only
the processing fee as defined in MIII below.

 

The following parameters shall be used in managing these sales activities and
shall be further defined in the Business Rules:

 

Named Accounts - Sony shall provide Provider with a list of Named Accounts.
Named Accounts are Customers to which a Sony Direct Equipment Sales
Representative and/or Sony Professional Services Representative is named or
specifically assigned.

 

Contract Renewals (including embedded service renewals), and Warranty
Conversions – Provider shall be the exclusive sales agent for managing contract
renewals and warranty conversions except in the case of a named account which is
assigned to a Sony Professional Services Representative and where the current
in-quarter contract renewal or warranty conversion opportunity is greater than
$200K for that named account.

 

Sony Professional Services Representatives – In situations where a Sony
Professional Services Representative is assigned, all sales of services with the
exception of Contract Renewals and Warranty Conversions under $200K shall be
sold by and credited to the Sony Professional Services Representative.

 

Sony Direct Equipment Sales Account Managers – In the case of a sale to a Sony
account to which a Sony Direct Equipment Account Manager is assigned, the Sony
Direct Equipment Sales Account Managers shall receive credit for the sale if
he/she generates the lead and is responsible for closing the sale. In this case,
Provider shall be entitled to only the processing fee as defined in Section
M.III below. In situations where a Sony Direct Equipment Salesperson is named,
but did not generate the lead or close the sale, Provider shall be entitled to
both commissions and processing fee.

 

Collaborative Selling with Sony Direct Equipment Sales Account Managers – In
some cases, a Sony Direct Equipment Sales Account Manager may wish to
collaborate with a Provider telesales representative to assist in securing a
services sale. Such assistance may include providing quotes, re-quotes,
equipment list updates and various follow-up activities. In such cases Provider
shall be entitled to between ***% and ***% of the sales commission as well as
the appropriate processing fee as described in MIII below. The percentage
differences shall be further defined in the Business Rules.

 

After Programs have been initiated, Sony shall provide at least sixty (60) days
notice to Provider of changes to the Programs or Target market to allow Provider
ample opportunity to make adjustments to forecasts, systems and communications
that are in progress.

 

Sony and Provider shall mutually agree upon the format and delivery/transfer
method of Customer data.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

5

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Marketing Programs

 

Provider shall develop marketing programs to meet Sony & Provider objectives for
the Programs. Provider shall create Sony-specific marketing strategies based on
Provider expertise and Sony business objectives. After analyzing, segmenting and
profiling Customer data, Provider shall execute specialized communication
programs to cost-effectively deliver renewal revenue. The marketing programs
shall leverage best practices and expert marketing strategies to cover each
Program and Customer segment with targeted offers resulting in strong Customer
relationships that lead to renewed contracts and acceptance of Up-Sell and
attachment offers.

 

Sony shall review and approve marketing concepts & materials for content and
clarity in writing and prior to distribution. Sony shall provide approval of
marketing campaigns within five (5) Business Days from date of receipt, or as
established in the Business Rules.

 

Excluded Accounts

 

Sony may identify a limited number of top accounts, which shall be excluded from
the Programs. Excluded accounts shall be identified at least 10 days prior to
Launch Date to insure proper data integration and marketing campaign
implementation.

 

  D. Product Sales Training

 

Sony shall provide initial product sales training (“training”) to Provider on
Sony’s Products applicable to the Outsource Services outlined in this SOW. Sony
and Provider shall agree on the amount of initial training required. The
training shall take place at Provider’s location in Scotts Valley, California.
Provider shall provide trainers for all ongoing and new hire training for
Outsource Services provided within the scope of this SOW. For additional
training required supporting Sony’s new products or services applicable to this
SOW, Provider and Sony shall agree on the amount of training required and the
training location.

 

Provider shall provide training on the Sony sales representative pricing and
quoting tool. Provider shall provide such training via web/teleconference to
Sony sales representatives. Support for Sony sales representatives shall be
provided via email or telephone.

 

  E. Telesales

 

Provider shall establish a dedicated team of sales professionals and customer
service representatives to conduct sales activities, answer customer questions,
facilitate customer request for changes, and provide quotes and process orders.
Provider’s dedicated sales team shall not, under any circumstances, work on
other Provider accounts.

 

Provider’s sales teams shall be introduced to their Sony counterparts or Sony
Direct Equipment sales representatives assigned to the same Target Markets,
Customers or territories. The purpose of this introduction and collaboration is
to ensure the best customer experience, eliminate conflict and inspire teamwork
resulting in successful sales Programs and increased Customer satisfaction. Sony
shall provide Provider with a Direct Equipment Sales Account Manager to Customer
matrix to assist Provider in the assignment of its sales representatives.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

6

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Provider shall also work with Sony to support the Sony sales organizations with
marketing information, lead referrals and Customer intelligence as well as
incorporating new sales messaging into the overall marketing strategy when
targeting renewal Customers. These four areas of support shall adhere to the
following guidelines and shall ultimately be established in the Business Rules:

 

  • Marketing Information – Rainmaker shall provide Sony sales organizations
with samples of the marketing campaigns for awareness.

 

  • Leads for new product sales can be forwarded to Sony for proper disbursement
via phone to a single point of contact.

 

  • Customer Intelligence consists of lost deal as per information obtained
either on line or via phone.

 

  F. Web Based Contract Viewing, Registration, Quoting and Ordering Tools

 

  • Online Registration Site – Provider shall create a Sony branded online
registration site for use by Customers, Resellers and Sony to register Sony
products and embedded services. This registration shall be used to populate the
online contract viewing site for each Customer as well as feed to IRIS for
entitlement. As with all other Outsource Service Deliverables, Provider shall
obtain Sony’s prior written consent before initiating use of the Sony branded
online registration site. Approval requirements for resellers shall be
established in the Business Rules.

 

  • On-Line Contract Viewing and Renewal Website - Provider shall deploy its
online contract viewing and renewal tools for Sony customers to view all of
their Sony equipment and status of current service. This Sony-branded web site,
which is integrated with the Sony pricing configurator, is the customer
destination for the Sony marketing programs, providing information to Sony
customers about eligible and recommended service offerings. Customers can view
terms and conditions, details of current warranty and service information,
update profile information, self quote, request moves adds and changes and make
purchases directly on line by credit card or purchase order. Provider’s
telesales team shall respond to all emails, requests for formal re-quotes and
inbound calls of customers who request assistance by calling the 800 number
posted on the web. As with all other Outsource Service Deliverables, Provider
shall obtain Sony’s prior written consent before initiating use of the On-Line
Contract Viewing and Renewal Website.

 

  • Sony Service Sales Representative Pricing, Quoting and Order Website – This
web portal is integrated with the Sony pricing configurator developed by
Provider and allows Sony Service sales representatives to price, quote and order
any Sony Product. Quotes generated for Customers shall automatically generate an
email to both the Customer and the sales representative. Customers may reply by
accepting the order on the web with a Purchase Order (P.O.) or credit card. Sony
sales representatives that receive confirmations and P.O.’s directly from the
customer shall enter the P.O. and customer information directly into the web
site. As with all other Outsource Service Deliverables, Provider shall obtain
Sony’s prior written consent before initiating use of the Sony Service Sales
Representative Pricing, Quoting and Order Website.

 

  • Orders initiated by Sony sales representatives shall require confirmation of
credit approval which shall be submitted as a web request on the sales
representative check out screen. A process for submitting credit approvals from
Sony to Provider shall be outlined in the Business Rules. All orders shall
generate an order confirmation email to both the sales representative and the
Customer. Orders initiated by Sony sales representatives that are accepted
directly by the Customer on the web shall generate

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

7

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a request for hard copy P.O. via fax or email. A process shall also be
established to confirm a Sony authorized credit approval. Sony sales
representatives shall also be required to fax the P.O. for each order that they
enter into the system.

 

  • Reseller Program – Provider and Sony shall work together to promote a
reseller participation program, which shall provide a win-win situation, for
both Sony and the reseller, building Sony brand equity, generating revenues and
providing Customers with an exceptional experience. In this Program resellers
shall provide Customer data in a predefined standard format and an authorization
for Sony and/or Provider to contact Customers for the purpose of extending, up
selling, renewing, and reactivating Sony Products.

 

Reseller Customer data shall be flagged with the reseller code and integrated
into the same sales and marketing programs as Sony direct Customers. Marketing
shall drive Customers to a secure website, co-branded with the reseller and Sony
branding. Customers wishing to purchase new Sony equipment shall have the
ability to link directly to the reseller site. Orders shall be tracked by
reseller for individual reseller reporting and compensation.

 

  • Reporting Portal - Provider shall provide a web based report portal where
reports are posted. Sony and Provider shall establish Reporting Portal specifics
via Business Rules Provider shall work with the Sony to develop a schedule for
reporting and delivery system to be provided. As with all other Outsource
Service Deliverables, Provider shall obtain Sony’s prior written consent before
initiating use of the Reporting Portal.

 

  G. Order Management

 

  • Provider generated orders – Provider shall manage and execute specific sales
and marketing Programs that generate orders for which Provider shall be
compensated as a percentage of the net sale price for the sale and an additional
percentage for the order processing. For these orders Provider shall check the
customer’s credit and assume any and all credit risk. Provider shall invoice the
Customer and collect the Customer payment. Customer payments shall be remitted
to the Provider DBA, i.e., “Sony Service Sales.”

 

  • Multiple frequency billing - Provider and Sony shall work together to
establish parameters for qualification and process management of monthly and
quarterly customer billings per contract. Details shall be managed through the
Business Rules.

 

  • Sony Service Representative Generated Orders – For orders initiated by Sony
Service Sales representatives and entered in through the web portal, Provider
shall be paid a percentage of the net sale price only for the order management.
In these cases, Provider shall accept orders submitted with a credit card or
P.O. as well as mail-in orders that are accompanied by a check. Orders shall be
checked for accuracy, receipt of P.O., and credit card verification. Customers
using a P.O. shall be invoiced with the remittance to the Provider DBA, i.e.,
“Sony Service Sales”.

 

  • Sony shall define for Provider all necessary data required for a valid
customer P.O. Provider shall make such requirements known to the customer and
use best efforts to secure all necessary information on each customer P.O.

 

  • Taxes – Sony and Provider shall each be responsible for its own taxes,
including, without limitation, income, franchise, property, sales, use and value
added taxes, assessments, other similar tax-like charges and tax-related
surcharges which may be required or imposed by any federal, state or local
taxing authority.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

8

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The relationship of the parties under this SOW shall be deemed for all purposes
to be independent contractors. Nothing in this SOW or the activities
contemplated by the parties pursuant to this SOW shall be deemed to create an
agency, partnership, employment or joint venture relationship between parties.
Each party shall be deemed to be acting solely on its own behalf and, except as
expressly stated, neither party shall have the right or authority to bind or
incur any liability or obligation of any kind on behalf of the other.

 

  • Entitlement - All approved orders shall be processed through the entitlement
system. Provider and Sony shall collaborate to create an automated data feed
from Provider’s systems into Sony’s IRIS system for entitlement registration on
a daily basis. This data file shall be mapped to IRIS providing information
including SKU, serial number, Customer#, Up-sell/Extension, Start/End Date,
Total Sales Amt, Net Sony Proceeds, Customer Address, Customer Contact Name &
Phone #. Data files shall be scheduled for sending to Sony each Business Day at
an agreed upon time based on integration requirements.

 

  • Updates to Online Viewing – All orders processed and entitled shall appear
on the Customer website for viewing and service management.

 

  • Temporary Staff for Interim Solution: In the event that the automated
entitlement feed into IRIS is not complete by the Launch Date, Provider shall
place one (1) temporary staff at Sony’s site in San Jose, CA to manually enter
entitlement information into Sony’s IRIS system. This interim Solution shall be
paid for by Sony to Provider through the margin in an amount equal to the cost
and expenses of this temporary service so long as Sony reviews and pre-approves
such costs in writing. Temporary Staff shall be hired and managed by Sony.
During the Interim Solution period, should the parties agree that additional
temporary staff are required, or should the Interim Solution period extend
beyond the initial timeframe, therefore requiring additional or continuing use
of Temporary Staff, Provider shall continue to retain such Temporary Staff for
the term mutually agreed upon between Sony and Provider, and Sony shall
compensate Provider at cost plus expenses through a margin adjustment.

 

  • Remittance to Sony – Provider shall generate a Consolidated Purchase Order,
(CPO) at the end of each month representing all approved orders, which have been
invoiced to Sony Customers. CPOs shall be separated by Sony initiated orders for
which Provider is Providing order management services only and Provider
initiated sales orders. For each CPO, Provider shall calculate the amount based
on the net contract price after Provider discount. CPOs shall reflect credits
and returns. Sony shall notify Provider within 3 business days of any
discrepancies found on the CPOs and invoice Provider for the amount due per CPO.
Rainmaker shall pay Sony’s invoice within 45 days of receipt. The CPO for Sony
initiated sales orders shall be submitted for those orders that were fully paid
during that month.

 

  • Collections – Provider shall be responsible for any and all collections
activities. For sales orders initiated by Sony sales representatives Provider
shall conduct collections activities for an agreed to period after invoice. If
the invoice is not paid by the agreed to period, Provider shall pass the order
information back to Sony collections for final collection action. At that point
in time, Provider responsibilities for collection from Customer or payment to
Sony shall cease for those orders passed back to Sony. Collections for sales
orders generated by Provider shall be the responsibility of Provider.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

9

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A misdirected payments policy shall be established and mutually agreed to within
the Business Rules. This policy shall guide both Provider and the Sony in the
event payments are provided inadvertently to Rainmaker or the Sony. The process
is to reconcile records and provide a check to the appropriate party to clear
the receivable. Contacts at both Provider and the Sony are required to ensure
smooth communications and processing

 

  • Discontinuance of Service for non-paying Customers – Provider will notify
Sony of any Customer who fails to pay Provider’s invoice within 60 days. Sony
shall discontinue the service for that customer and refund Provider the amount
equal to the prorated portion of the net sale associated with the Product.

 

  H. IT Efforts – Data Files and Transfers

 

  • Data Files and Data transfer formats/layouts – Sony and Provider IT and
business group shall agree (in advance and in writing) upon appropriate layouts
for data transfers in the Business Rules.

 

  • Customer Data Updates – Provider shall provide Customer incremental contact
data updates (contact name, phone number, address, fax number, email address) to
Sony on a monthly basis in an agreed upon layout. Data files shall be scheduled
for sending to Sony between 12pm – 3pm CST on the second Monday of every Month.

 

  • Install Base – Sony shall provide incremental updates to the install base to
Provider on a monthly basis. The updates shall include additional sales and
modifications to previous Customer asset information. Data files shall be sent
to Provider between 12pm – 3pm CST on the 2nd to last Monday of every month.

 

  • Customer Contact Data – Sony shall provide customer contact data, including
contact name, email address, mailing address, phone number & fax number where
available. Contact data must be provided within 15 business days of Effective
Date.

 

  • Sony Pricing Data – Sony shall provide pricing updates to Provider, which
contains product, service level, service offering and all pertinent pricing
information. Data file shall be sent to Provider between 12pm – 3pm CST.
Provider shall require a minimum of five (5) days to implement and test pricing
updates.

 

  • Confidential Sony Data Requirements - Provider shall meet Sony’s
requirements for keeping Sony confidential information at a Provider’s off site
facility. The following requirements must be met:

 

  • All transmission of Data must be done securely, i.e. encrypted.

 

  • For the initial data exchange

 

  • For all subsequent exchange (daily updates or employee updates) of
information

 

  • Access to the data shall be via identification and authentication methods
that meet or exceed Sony’s standards.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

10

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  • Provider shall comply with all other terms and conditions of the Sony
Non-Disclosure Agreement Dated November 7, 2003 between Sony and Provider.

 

  I. Deliverables/Approvals

 

The following written approvals shall be required by Sony for all development
work and Sony branded deliverables:

 

  • Scope Document for Configurator

 

  • Scope Document for Process Flows

 

  • Marketing Campaign Review Documents

 

  • Content of Sony Marketing Campaigns

 

  • Sony Web-site Design Review Documents

 

  • Sony Sales Representative Web Tool

 

  • Content of Sony Web-site

 

  • Consolidated P.O. for contracts sold

 

  • Reports from Programs as outlined in this SOW

 

  J. Business Review and Engagement

 

  • Quarterly Performance Assessments- At the end of every 3 month-period
following Launch Date, Rainmaker and Sony may mutually agree to adjust program
commission percentages for the programs. At each 3-month review, Rainmaker and
Sony shall identify and implement activities that improve efficiencies and/or
attainment levels of the programs. Beginning with the 2nd 3-month review (at the
end of the first 6 month period) and every 3 months thereafter, Rainmaker and
Sony shall work in good faith to adjust program pricing accordingly to share any
impact to the net contribution actually achieved. Improvements to the net
contribution of the programs shall be shared through price adjustments to the
programs. Declines in the net contribution due to such actions as changes to the
service offering and/or price changes to the service contracts affecting the
success of the program are also to be considered for sharing between Rainmaker
and Sony. Sony and Rainmaker shall mutually agree to any pricing changes in
Writing.

 

  • Weekly Sales Review – Provider shall provide weekly sales reports and
participate in a weekly status meeting.

 

  • Quarterly Business Review – Provider and Sony shall meet on a quarterly
basis to review the financial results, renewal rates, customer service metrics,
marketing activities and forecasts. Location of the meeting shall alternate
between Sony and Rainmaker selected locations.

 

  K. Service Offerings and Price Changes

 

  • List Price of Services to Rainmaker

 

Sony shall provide Service list pricing and appropriate discounting structures
that shall be used by Provider as the basis for selling Sony services. Sony
shall convey services based upon pricing in effect per the most recent list
pricing submitted to Provider. Sony shall provide Provider with notification of
price changes within 5 days of price changes and shall submit changes to
Provider via an agreed upon pricing file format. Provider shall incorporate
price within 5 days of Sony providing a new price file. Provider shall have
price protection for any outstanding quotes for thirty (30) days after any price
change.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

11

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  • Discontinuance of Service Offerings

 

Sony shall provide Provider with sixty (60) Business Days written notification
before Sony discontinues service offerings impacting the Programs.

 

  • Sony-Based Pricing Promotions

 

Provider shall be permitted to participate in any and all sales discounting
promotions that Sony may offer from time to time in connection with any Service
Offerings within the Programs.

 

  L. Reports

 

Reports Provided by Provider: TBD

 

Weekly

 

  • Revenue reporting by segment and program.

 

Monthly

 

  • This report provides all sales and returns activity within a calendar month.
Information provided on this report shall include the following: Order Invoiced
date, Customer number, Customer name, Customer ship to information, Customer
contact, Provider order number and line number, Provider SKU, Sony description,
List Price, Total List Price, Selling price, Total Selling Price, Total Quantity
Sold, Unit Cost and Total Cost Due.

 

Quarterly

 

  • Quarterly business review includes reporting on revenue attainment vs.
forecast, renewal rate, marketing activity summary, and marketing response rate.
Reporting by segment and program.

 

Custom Reports

 

  • Provider shall work with Sony to determine custom report requirements.
Custom reports can range from product and/or service level specific to customer
and/or segment specific. Reports can be provided in a number of formats that are
easily imported into other systems or applications for manipulation,
consolidation, further reporting and presentation. Sony and Provider shall work
together to identify reports, content, format and frequencies that best meet
Sony’s needs.

 

Sony may request custom reports or other business changes, which shall be
provided by Provider pursuant to an amendment to the SOW that shall include an
estimate of the cost of the customer report or other business changes. Provider
shall implement the modifications only upon written authorization from Sony. In
this case modifications refer to reporting and other minor enhancements to
support the business relationship. It does not refer to fundamental changes in
offerings or significant changes to tools.

 

  M. Pricing

 

Pricing Terms and Conditions

 

The pricing, underlying estimations and projected attainment for the Program
Outsourced Services have been based on representations, information, data,
estimates and assumptions provided by Sony to Provider. The parties agree that
should that information prove to be materially different from the estimates and
assumptions listed below, that Sony and Provider shall, in good faith, work to
resolve to mutual satisfaction.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

12

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  III. Pricing

 

Contract Renewals, Reactivations, Warrany Conversions and Up-Lift or New Service
Sales

 

Margin-based CRP Renewal and Reactivation Services include:

 

•      Data Management and Analysis

  

•      Customer Contact Center

•      Direct Marketing Delivery

  

•      Contract Viewing Website, Reseller Program, Sony Services Web Based
Services Quoting and Order Tool.

 

•      On-going management for Sony and Sony Resellers

•      Professional Telesales

  

•      Automated data feeds and data process management

 

Order management for non-Provider generated orders - The pricing for this shall
be consistent with the tiered pricing for ICC based on the volume of
commissioned orders being generated at any given time.

 

The qualifications for this service are: 1) Sony Service sales representatives
shall confirm that Sony credit check has been performed based on Sony credit
criteria (this shall be a confirmation check box on the web tool when the Sony
Service representative submits the order), and 2) Sony assumes the credit risk
for these orders, 3) Provider shall attempt to collect up to an agreed upon
window of time after which Sony shall take over collections and determine course
of action, 4) the value of orders managed through this process shall not affect
Provider’s credit limit.

 

Reseller web branding customization - $2500 per reseller for up to 5 resellers -
tiered pricing shall be established after the first 5 implementations

 

Tiered Pricing Schedule:

 

   

Tier 1

--------------------------------------------------------------------------------

 

Tier 2

--------------------------------------------------------------------------------

 

Tier 3

--------------------------------------------------------------------------------

 

Tier 4

--------------------------------------------------------------------------------

    ***   ***   ***   ***

Gross Billings

  ***   ***   ***   ***

Margin

  ***   ***   ***   ***

Net to Sony

  ***   ***   ***   ***

ICC Margin*

  ***   ***   ***   ***

 

Margin based on cumulative gross billings for a 12-month period from the
contract anniversary date.

--------------------------------------------------------------------------------

* Margin is based on percentage of gross billings.

 

  Implementation and Start-Up Fees

 

Design, develop and approval for initial multi-step marketing Campaign for four
Sony Programs

   $ * **

Integration, Business Unit Set-Up, Technology costs for Development Automated
Data Processes, Contract Viewing Website, Reseller Program Set-Up

   $ * **

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

13

--------------------------------------------------------------------------------

  IV. Provider’s Requirements for Personnel, Agents or Subcontractors

 

  • Provider Liaison: By no later than 10 Business Days from the Effective Date,
Provider shall appoint an employee who shall function as Sony’s primary Provider
contact (“Provider Liaison”) during the integration process. Such Provider
Liaison shall be highly knowledgeable in all aspects of Provider’s sales,
marketing, finance and back office services.

 

  • Provider IT Liaison: Provider shall appoint an employee who shall function
as Sony’s primary Provider contact for the duration of the agreement. Such
Provider Liaison shall be highly knowledgeable in all aspects of Provider’s IT
solutions.

 

  • Provider Sales Team: Provider shall create a dedicated sales team to perform
outbound/inbound calling to Sony customers. All reps shall complete the minimum
agreed upon product sales training prior to beginning sales.

 

  V. Sony’s Responsibilities

 

  • Sony Liaison: By no later than 10 Business Days from the Effective Date,
Sony shall appoint an employee who shall function as Provider’s primary Sony
contact (“Sony Liaison”). Such Sony Liaison shall be highly knowledgeable in all
aspects of Sony’s sales and fulfillment Business Rules and should be highly
skilled in using the provisioning services under the Service Contracts.

 

  • Data Resource: Sony shall provide Provider with the assistance of one or
more Sony employees (other than the Sony Liaison) who are skilled in the Sony
Databases to enable Provider to integrate the Sony Databases with the Provider
Database at Provider’s data processing facilities. This person shall be
responsible for facilitating the transfer of any incremental data files to
Provider and any transaction data files sent from Provider to Sony.

 

  • Administration of the Relationship: Provider’s officers and business unit
director shall have direct access to a Sony executive sponsor to be named in the
Business Rules and updated as necessary.

 

  • Customer Contact: Sony hereby expressly authorizes Provider to contact
Sony’s customers on the basis of and in furtherance of Sony’s established
business relationship with its customers for programs and services outlined in
this agreement. Sony shall identify select accounts to exclude from Provider
contact.

 

  VI. Business Rules - Prior to the Launch Date, Provider and Sony shall
mutually agree upon Business Rules governing the day-to-day administration of
this SOW and the parties’ relationship hereunder. Both parties agree to use
their reasonable efforts to develop mutually satisfactory Business Rules to
implement this SOW and acknowledge that the Business Rules may need to be
modified from time to time.

 

  VII. Launch Date - Provider’s sales launch date is targeted for June 17, 2004
(8 weeks of integration time from Effective Date estimated to be April 22,
2004). Preparation for launch requires on-going IT integration efforts and
establishing Business Rules between Sony and Provider. Milestone meetings shall
be conducted to review project plans and ensure timely launch.

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

14

--------------------------------------------------------------------------------

 

Agreed and Accepted:   Agreed and Accepted: SONY ELECTRONICS INC.   RAINMAKER
SERVICE SALES, INC.

By:

 

/s/ Dan P. Wirrsma

--------------------------------------------------------------------------------

 

By:

 

/s/ Martin Hernandez

--------------------------------------------------------------------------------

Printed Name:

 

Dan P. Wirrsma

 

Printed Name:

 

Martin Hernandez

Title:

 

SVP

 

Title:

 

President

Date:

 

4/21/04

 

Date:

 

4/21/04

 

Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated “***”. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission

 

15