<PAGE>

                                                                   EXHIBIT 10.18

                                                            VITRIA CONTRACT 8511

                       DEVELOPMENT AND SERVICES AGREEMENT

         This Development and Services Agreement is entered into between Vitria
Technology, Inc., a Delaware corporation, ("Vitria") and CHILIN, LLC, a
California limited liability company, ("ChiLin") and shall become effective on
the Effective Date.

         WHEREAS, Vitria desires that ChiLin develop certain Deliverables that
shall be defined in separate Statements of Work to be mutually agreed upon in
writing by the parties and subject to the terms and conditions of this
Agreement;

         WHEREAS, ChiLin desires to develop such Deliverables for Vitria under
the terms and conditions of this Agreement.

         WHEREAS, Vitria desires to retain ChiLin for its experience and
abilities in connection with creating, revising, updating or troubleshooting
relating to the Deliverables, and has offered to engage ChiLin to render such
services (hereinafter the "Services") to Vitria, which shall be specifically
described in Statements of Work as mutually agreed by the parties and as
attached hereto; and

         NOW THEREFORE, in consideration of the mutual covenants, terms and
conditions hereinafter expressed, the parties hereby agree as follows:

1.       DEFINITIONS

1.1      "Affiliate" means any corporate entity which, directly or indirectly,
through one or more intermediaries, controls or is controlled by, or is under
common control with, another corporate entity.

1.2      "Change Request" means a document detailing additional features,
enhancements or other modifications as set forth in Section 2.2.

1.3      "Confidential Information means any business, marketing or technical
information disclosed by Vitria or ChiLin to the other in relation to this
Agreement, and identified in writing as being confidential, proprietary or trade
secret in nature to, the disclosing party. If disclosed orally, such information
must be identified at the time of disclosure as confidential, proprietary, or
trade secret in nature and thereafter summarized in writing, marked as
confidential, with the summary delivered to the receiving party within 30 days
after disclosure. Notwithstanding the foregoing, all Deliverables shall be the
Confidential Information of Vitria regardless of the marking requirements.

1.4      "Deliverables" means those goods and Services developed or performed by
ChiLin and provided to Vitria pursuant to a Statement of Work.

1.5      "Dependencies" means are those conditions, goods or services necessary
or precedent for the delivery of the Deliverables as set forth in the Statement
of Work.

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                                                            VITRIA CONTRACT 8511

1.6      "Derivatives" means any translation, abridgement, revision,
transformation, adaptation, improvement, or new material derived from any ChiLin
technology, tools, and components existing in trade secret material, including
new material which may be protected by copyright, patent and/or trade secret
that are contained, integrated and/or embedded in the Deliverables.

1.7      "Development Center" means the location(s) in Greater China where the
Services are to be performed.

1.8      "ChiLin Fee" means those fees set forth in the Statement of Work.

1.9      "Documentation" means the user manuals and other related materials,
including without limitation any training materials, installation documentation
and documentation for the Software, in whatever medium regarding the proper
installation and use of the Deliverables described therein, and all updates, new
versions and any other modifications made to such materials.

1.10     "Effective Date" means the last date this Agreement is signed by both
parties.

1.11     "Export Laws" means all laws, administrative regulations, and executive
orders of any applicable jurisdiction relating to the control of imports and
exports of commodities and technical data, including, without limitation, the
Export Administration Regulations of the U.S. Department of Commerce, the
International Traffic in Arms Regulations of the U.S. Department of State, and
the Enhanced Proliferation Control Initiative.

1.12     "Object Code" means the machine-readable computer code that (i) enables
the computer to execute a program, (ii) is derived from the Source Code to the
product by a process generally referred to as compiling and (iii) may be stored
in a variety of magnetic media or other formats.

1.13     "Software" means Object Code and Source Code of the Deliverables as set
forth in the Statement of Work which include without limitation, any and all
enhancements, bug fixes, updates, new versions, ports, localized versions and
other modifications made for such products that are provided to Vitria pursuant
to the terms of this Agreement.

1.14     "Source Code" means the underlying computer program which (i) comprises
a product, (ii) is readable by human beings when displayed on a monitor or
printed on paper, regardless of the media on which the product is stored, and
(iii) that must be translated by a process generally known as compiling into
Object Code before the product can be executed by a computer.

1.15     "Statement of Work" means a document substantially in the form attached
as Exhibit A and signed by authorized representatives of both parties under
which ChiLin agrees to perform Services for Vitria.

1.16     "User Acceptance Tests ("UATs") means tests run by Vitria to determine
that the Deliverables have met the requirements in the Statement of Work,
including but not limited to running manual spot tests and the product sample.

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                                                            VITRIA CONTRACT 8511

2.       SCOPE OF WORK

2.1      ChiLin agrees to use commercially reasonable efforts to develop for
         Vitria the Deliverables, and provide to Vitria the Services, in
         accordance with the requirements and specifications set forth in the
         executed Statements of Work referencing this Agreement. The terms of
         each respective Statement of Work are intended to establish the
         applicable requirements, specifications, schedules, outputs, and other
         services associated with the Deliverables and the Services. The parties
         also intend to discuss certain additional work efforts in the future
         and will mutually agree in writing on any such additional Statements of
         Work. The terms and conditions of this Agreement will govern additional
         Statements of Work. Although the parties agree to consider additional
         work efforts, there is no assurance that additional Statements of Work
         will be authorized or agreed upon.

2.2      Requested Changes.

         2.2.1    If Vitria desires a variation to any Statement of Work, it
                  will supply a Change Request to ChiLin. A Change Request must
                  specify in sufficient detail the change to be considered. If
                  Vitria supplies a Change Request, at ChiLin's cost, ChiLin
                  shall conduct an analysis of the impact of the request on the
                  price, schedule, Deliverables and/or Services of the relevant
                  Statement of Work and submit a written summary to Vitria for
                  approval. ChiLin reserves the right, for a significant work
                  effort associated in an impact analysis for a change request,
                  to charge Vitria on a time and materials basis, using the time
                  and materials services rates specified in the Statement of
                  Work to which the Change Request applies, or as otherwise
                  mutually agreed by Vitria and ChiLin. Any impact analysis work
                  to be charged to Vitria shall require prior approval from
                  Vitria; such approval shall not be unreasonably withheld. The
                  authority to authorize any impact analysis work must come, in
                  writing, from Vitria's VP of Customer Services and Engineering
                  Operations (or other designated executive officer), otherwise,
                  no such charges will be honored.

         2.2.2    Once the impact analysis of a Change Request has been
                  completed, it shall be submitted in writing to Vitria
                  management for approval. Change Requests shall only be acted
                  upon once they have been agreed and duly authorized in writing
                  by both ChiLin and Vitria. Neither party will have any
                  obligation to execute a Change Request.

2.3      The parties will discuss progress made on the Deliverables and issues
         that may arise with respect to the Services during the status meetings
         as required under a Statement of Work. Either party will notify the
         other promptly upon learning of any event that may impact the
         Deliverables or the Services.

3.       DEVELOPMENT, DELIVERY AND SERVICES

3.1      ChiLin will use commercially reasonable efforts to develop and deliver
         the Deliverables, and provide the Services, to Vitria in accordance
         with the applicable schedules set forth in the relevant Statement of
         Work; ChiLin acknowledges and agrees that time is of the essence in
         performance of it obligations hereunder provided, however, that ChiLin
         shall not be responsible for delays in the:

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                                                            VITRIA CONTRACT 8511

         3.1.1    development or delivery of the Deliverables attributable to
                  time incurred as a result of defective Dependencies (as
                  defined in the applicable Statements of Work) to be delivered
                  by Vitria or a third party not in the control of ChiLin or
                  delays in the delivery of conforming Dependencies by Vitria or
                  a third party not in the control of ChiLin, or

         3.1.2    development or delivery of the Deliverables or provision of
                  the Services attributable to circumstances beyond ChiLin's
                  reasonable control, including, without limitation, delays in
                  the delivery of materials by Vitria or a third party not in
                  the control of ChiLin. If any such delays occur, the delivery
                  schedule of the Deliverables and/or the Services, but not the
                  associated fees, shall be adjusted by a period equal to the
                  period of such delay. For purposes of this Section 3.1.2,
                  circumstances beyond ChiLin's control include, without
                  limitation, events such as earthquakes, wars, severe power
                  outages affecting the region where ChiLin is located, but does
                  not include failure of ChiLin's equipment, labor unrest,
                  illness or other similar circumstances.

3.2      ChiLin shall designate in Statements of Work from time to time which of
         its employees or consultants are to provide the Services thereunder.
         ChiLin shall be entitled to change the persons designated to provide
         the Services in its reasonable discretion as a result of, (a)
         termination of such person's employment or engagement with ChiLin for
         any reason, (b) such person's illness or death, or (c) such person's
         failure to perform the Services in a manner satisfactory to ChiLin. If
         Vitria is dissatisfied with the performance of any of ChiLin's
         consultants or employees performing Services under this Agreement,
         ChiLin shall, within seven (7) calendar days of Vitria's written notice
         to ChiLin, replace such consultant or employee with a trained and
         skilled individual suitable to Vitria.

3.3      ChiLin may make and retain in its possession a reasonable number of
         copies of the Deliverables. Such copies shall remain the property of
         Vitria, except as provided in Section 10, and shall be used by ChiLin
         only for the purpose of enabling ChiLin to satisfy ChiLin 's
         obligations under this Agreement.

4.       PROGRESS REPORTS

4.1      As required under a Statement of Work, ChiLin agrees to provide Vitria
         with written progress reports showing the status of the Deliverables
         being developed hereunder, and to participate in other status review
         meetings with Vitria, at such times agreed upon by the parties.
         Participation in such meetings may occur via teleconferencing. Such
         review meetings will be for the purpose of:

         4.1.1    reviewing the progress of the development of the Deliverables
                  and the Services provided by ChiLin; and

         4.1.2    formulating, if necessary, details of development activity in
                  the following weeks or details of the Services to be provided
                  in the future; and coordinating UAT, installation and training
                  schedules.

4.2      Additional meetings will be held as reasonably requested by either
         party.

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                                                            VITRIA CONTRACT 8511

5.       MAINTENANCE, INSTALLATION, TRAINING AND TECHNICAL SUPPORT

5.1      The maintenance, installation, training, and/or other technical
         support, if any, which ChiLin will perform in connection with the
         Deliverables (which include Software and Documentation) are as set
         forth in the Statements of Work.

5.2      At ChiLin's written request, Vitria shall provide two FTE resources,
         for up to 12 months from the Effective Date, to work with ChiLin at the
         Development Center on product training, engineering process, product
         enhancements, product specifications, and related product engineering
         tasks. The costs associated with such employees during their work with
         ChiLin, including salary, travel, and expenses, shall be borne by
         ChiLin.

6.       PAYMENT

6.1      Vitria shall pay to ChiLin the ChiLin Fee and other fees specified in,
         and in accordance with, the payment schedule set forth in the relevant
         Statements of Work. The ChiLin Fee and such other fees shall be full
         payment for development of the Deliverables, provision of the Services,
         and all other agreed upon activities, Deliverables and Services
         rendered under this Agreement, unless otherwise set forth herein or in
         a Statement of Work.

6.2      Unless otherwise set forth in a Statement of Work, Vitria shall be
         responsible for all travel expenses pre-approved by Vitria in writing
         incurred by ChiLin during the performance of services pursuant to a
         Statement of Work.

6.3      Vitria shall be responsible for the payment of all taxes, duties and
         licenses, including taxes paid or payable by ChiLin or which ChiLin is
         required to collect, in connection with the performance of this
         Agreement, the delivery of the Deliverables, the provision of the
         Services, or arising from the use, operation or possession of the
         Deliverables or any part thereof, excluding any taxes based on ChiLin's
         income and any income, payroll or other withholding taxes. If either
         party is exempt from any taxes, the exempt party shall provide the
         other party with the necessary documentation required by the taxing
         authority to sustain such an exemption.

6.4      Payment of all invoices shall be made by Vitria net 30 days following
         the date Vitria's receipt of an undisputed invoice. Vitria shall pay
         all undisputed portions of such invoice net 30 days following receipt.

6.5      All fees shall be deemed overdue if, unless disputed, they remain
         unpaid thirty (30) days after they become payable. All overdue amounts
         shall bear interest at the rate of one and one-half percent (1 - 1/2%)
         per month or the maximum legal rate, whichever is lower. Vitria shall
         reimburse ChiLin for all reasonable costs incurred (including without
         limitation reasonable attorneys' fees) in collecting past due amounts.

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                                                            VITRIA CONTRACT 8511

7.0      DELIVERABLES ACCEPTANCE

7.1      UAT of the Deliverables (which include Software and Documentation)
         shall commence on the appropriate delivery dates set forth in the
         relevant Statement of Work. UAT shall be conducted in accordance with
         the procedures, criteria, and timeframes set forth in such Statement of
         Work. If the Deliverables or any portion thereof are not accepted
         (Vitria's acceptance not to be unreasonably withheld, delayed or
         conditioned), ChiLin agrees to make (without any additional charge to
         Vitria) any necessary changes to the Deliverables to correct such
         errors or deviations as soon as commercially practicable following
         receipt of notice of such errors and deviations. If ChiLin reasonably
         believes that correction of such errors or deviations will take longer
         than ten (10) business days to complete and redeliver, ChiLin shall
         notify Vitria immediately, discuss the timing of the delay and the
         means necessary to correct it and propose, if applicable, alternate or
         interim solutions.

8.0      CHILIN PERSONNEL

8.1      ChiLin warrants that all personnel assigned to perform work under this
         Agreement have entered into, or will enter into prior to performing
         such work, an agreement consistent with the provisions of this
         Agreement.

9.0.     OWNERSHIP

9.1      Vitria shall own exclusively (i) all Vitria software and other
         materials Vitria provides ChiLin pursuant to this Agreement, (ii) any
         and all changes or other modifications made by Vitria or ChiLin to the
         Vitria software or other Vitria materials, whether in Source Code or
         Object Code form (the "Vitria Modifications"), and (iii) all of the
         other development Deliverables, development notes and other tangible
         materials generated by Vitria or ChiLin in connection with any
         development effort pursuant to this Agreement (the "ChiLin Materials").
         Except as warranted in Section 11 below, ChiLin expressly disclaims any
         authorship or ownership of the Vitria software, whether or not
         resulting from the development efforts contemplated hereunder, whether
         in Source Code or Object Code form, or any proprietary rights related
         thereto, whether now known or hereunder recognized in any jurisdiction
         including but not limited to any copyrights or patent, trademark or
         trade secret rights thereto.

         ChiLin hereby assigns, and shall assign when developed, to Vitria
         ownership of all right, title and interest in and to the Deliverables,
         Vitria Owned Modifications and Vitria Materials, as and when created,
         including but not limited to all copyrights, and other intellectual
         property rights now known or hereafter recognized, including without
         limitation any patent, trademark or trade secret rights in any of the
         foregoing, and ChiLin acknowledges and agrees that Vitria shall be
         considered the author for copyright purposes of all copyrightable
         material contained in the Deliverables, the Vitria Modifications and
         the Vitria Materials. If ChiLin has any rights to the Deliverables,
         Vitria Modifications or Vitria Materials that cannot be assigned to
         Vitria by matter of law, ChiLin unconditionally and irrevocably waives
         the enforcement of such rights, and all claims and causes of action of
         any kind against Vitria with respect to such rights, and agrees, at
         Vitria's request and expense, to consent to and join in any action to
         enforce such rights. If ChiLin has any right to the Deliverables,
         Vitria Modifications or Vitria Materials that cannot be assigned to
         Vitria or

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                                                            VITRIA CONTRACT 8511

         waived by ChiLin as a matter of law, ChiLin unconditionally and
         irrevocably grants to Vitria during the term of such rights, an
         exclusive, irrevocable, perpetual, worldwide, fully paid and
         royalty-free license, with rights to sublicense through multiple levels
         of sublicensees, to reproduce, create derivative works of, distribute,
         publicly perform and publicly display by all means now known or later
         developed, such rights. ChiLin agrees to assist Vitria as commercially
         reasonably necessary to perfect the ownership of such rights in Vitria,
         and to that end shall cause all ChiLin supplied employees, independent
         contractors and consultants for the development effort to agree in
         writing, with Vitria as an acknowledged third party beneficiary of such
         agreements with coverage to include all work done related to this
         Agreement is specially ordered performed for Vitria's benefit and that
         all such work and any related materials shall be the confidential and
         proprietary property of Vitria, to agree to disclose all such work
         Deliverables, Vitria Modifications and Vitria Materials and to assign
         any and all rights therein, including in the Deliverables, Vitria
         Modifications and Vitria Materials to Vitria, as and when created.

9.2      ChiLin will provide reasonable assistance and cooperation to Vitria to
         acquire, transfer, maintain, perfect, and enforce the intellectual
         property rights in the Deliverables owned by Vitria, including, but not
         limited to, execution of a memorandum of assignment of ownership, or
         such other documents as may reasonably be requested by Vitria.

9.3      Vitria hereby grants to the ChiLin, subject to the terms and conditions
         of this Agreement, a nonexclusive, nontransferable, nonassignable
         license to use the Vitria products, including Source Code and Object
         Code, set forth in the Statements of Work and the associated
         documentation obtained pursuant to this Agreement solely at the
         Development Center for the purposes as set forth in the Statements of
         Work. ChiLin shall not cause or permit the reverse engineering,
         disassembly, or decompilation of the Vitria products.

9.4      ChiLin shall own exclusively all ChiLin software and other materials
         ChiLin provides Vitria pursuant to this Agreement that ChiLin owned or
         developed independently of a particular Statement of Work. Vitria
         expressly disclaims any authorship or ownership of the ChiLin software
         and other materials provided to Vitria under this Agreement, whether in
         Source Code or Object Code form, or any proprietary rights related
         thereto, whether now known or hereunder recognized in any jurisdiction
         including but not limited to any copyrights or patent, trademark or
         trade secret rights thereto.

9.5      ChiLin shall be free to use its general knowledge, skills and
         experience, and any ideas, concepts, know-how and techniques that are
         acquired or used in the course of providing the Services.

10.0     NONDISCLOSURE

10.1     Vitria Confidential Information.

         10.1.1   ChiLin agrees, on behalf of itself, its affiliated companies,
                  and its employees, independent contractors and consultants
                  that it shall not use, except as otherwise expressly permitted
                  hereunder, or disclose to any third person, including any
                  Affiliates, or to any employee of ChiLin without a need to
                  know, either during or after the term of this Agreement, any
                  Confidential Information of Vitria. ChiLin and its employees,
                  independent contractors and consultants shall use the same
                  degree of care as ChiLin uses to protect its own confidential
                  information of a similar nature, but in
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                                                            VITRIA CONTRACT 8511

                  no event less than reasonable care, to avoid disclosure of
                  Vitria Confidential Information. The foregoing obligation of
                  nondisclosure shall not apply to information which: (i) was
                  already publicly or was independently developed outside the
                  scope and without awareness of this Agreement, and does not
                  otherwise infringe Vitria's intellectual property rights when
                  disclosed by ChiLin, (ii) was in the rightful possession of
                  ChiLin at the time of disclosure by Vitria outside the scope
                  of this Agreement, (iii) is disclosed as a matter of right by
                  a third party after the execution of this Agreement.

         10.1.2   ChiLin warrants that all employees, independent contractors
                  and consultants of ChiLin having access to any Vitria
                  Confidential Information, or who may reasonably be anticipated
                  to be exposed to any Vitria Confidential Information, have
                  entered into, or will enter into prior to providing Services,
                  a confidentiality agreement which contains, at a minimum, the
                  substance of the preceding paragraph, as well as an
                  acknowledgment providing coverage that (a) Vitria owns the
                  Vitria Products, the Deliverables, the Vitria Modifications
                  and the Vitria Materials, and (b) they assign all their rights
                  in the Vitria Products, the Vitria Owned Modifications and the
                  Vitria Owned Materials, if any, to Vitria, as and when
                  created. At the request of Vitria, ChiLin shall provide copies
                  of such agreements to Vitria.

         10.1.3   In the event of a breach of this Section 10.1, money damages
                  will not be an adequate remedy, and therefore, in addition to
                  any other legal or equitable remedies, Vitria shall be
                  entitled to seek an injunction or other equitable relief
                  against such breach without necessity of posting bond or
                  security, which is expressly waived.

10.2     ChiLin Confidential Information.

         10.2.1   Vitria agrees, on behalf of itself, its affiliated companies,
                  and its employees, independent contractors and consultants,
                  that except as otherwise expressly permitted hereunder, it
                  shall not use or disclose to any third person, including any
                  Affiliates, or to any employee of Vitria without a need to
                  know, either during or after the term of this Agreement, any
                  Confidential Information of ChiLin. Vitria and its employees,
                  independent contractors and consultants shall use the same
                  degree of care as Vitria uses to protect its own confidential
                  information of a similar nature, but in no event less than
                  reasonable care, to avoid disclosure of ChiLin Confidential
                  Information. The foregoing obligation of nondisclosure shall
                  not apply to information which: (i) was already publicly known
                  or was independently developed when disclosed by ChiLin, (ii)
                  was in the rightful possession of Vitria at the time of
                  disclosure by ChiLin, or (iii) is disclosed as a matter of
                  right by a third party after the execution of this Agreement.

         10.2.2   All employees, independent contractors and consultants of
                  Vitria having access to any ChiLin Confidential Information,
                  or who may reasonably be anticipated to be exposed to any
                  ChiLin Confidential Information, shall execute or shall have
                  executed confidentiality agreements which contain, at a
                  minimum, the substance of the preceding paragraph. At the
                  request of ChiLin, Vitria shall provide copies of such
                  agreements to ChiLin.

         10.2.3   In the event of a breach of this Section 10.2, money damages
                  will not be an adequate remedy, and therefore, in addition to
                  any other legal or equitable remedies, ChiLin shall be
                  entitled to seek an

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                                                            VITRIA CONTRACT 8511

                  injunction or other equitable relief against such breach
                  without the necessity of posting bond or security, which is
                  expressly waived.

10.3     Authorized Disclosure. Either party may disclose the general existence
         and nature of this Agreement, but may not disclose the specific terms
         of this Agreement without the prior consent of the other party.

11.      WARRANTIES AND INDEMNIFICATION

11.1     ChiLin Warranty/Indemnification.

         11.1.1   ChiLin represents and warrants ChiLin has full, unimpeded
                  power and right to perform all of the terms of this Agreement.

         11.1.2   ChiLin represents and warrants that

                  i)       All software code, documentation, and other materials
                           developed, created or delivered to Vitria pursuant to
                           this Agreement do not contain, misappropriate or
                           infringe any third party trade secret or other
                           intellectual property, right or other right of any
                           kind, and that there are no liens, claims or
                           encumbrances of any kind on the Deliverables in any
                           way or of any kind, but only to the extent that such
                           misappropriation or infringement (i) results from or
                           relates solely to the Deliverable (and does not
                           relate to the underlying Vitria Software) and (ii)
                           with respect to the Deliverable, is not based on
                           information, direction, specification or materials
                           provided by Vitria.

                  ii)      ChiLin has full power and right to perform all other
                           terms of this Agreement; and any distribution or use
                           by Vitria or its licensees of Deliverables, or of any
                           other software code, documentation or other materials
                           provided to Vitria under this Agreement will not
                           violate or interfere with the intellectual property
                           or contractual rights of any third party, including
                           without limitation, those rights arising under
                           copyright, trademark, trade secret or patent law, but
                           only to the extent that such violation or
                           interference (i) results from or relates solely to
                           the Deliverable (and does not relate to the
                           underlying Vitria Software) and (ii) with respect to
                           the Deliverable, is not based on information,
                           direction, specification or materials provided by
                           Vitria.

                  (iii)    To the knowledge of ChiLin, Deliverables from ChiLin
                           do not include any instructions, algorithms or code
                           that would cause any software product (including any
                           component, routine, or sub-routine thereof or other
                           data relating thereto) to maliciously: (i) be
                           modified or damaged, (ii) modify, damage or delete
                           itself or cause other software, programs, routines or
                           sub-routines or data to be modified, damaged or
                           deleted or to modify, damage or delete themselves,
                           (iii) replicate and propagate itself throughout other
                           software, programs, routines or sub-routines or data,
                           (iv) search for and consume memory in computers or
                           transmit data, (v) usurp the normal operation of
                           computer facilities or (vi) alter or place itself
                           within or substitute itself for any of the software
                           products, including any component, routine, or
                           sub-routine thereof and other data relating thereto.

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         11.1.3   ChiLin represents and warrants that the Deliverables as
                  delivered shall materially conform to the specifications set
                  forth in the applicable Statement of Work for a period of
                  sixty (60) days from delivery. Upon receipt of written notice
                  from Vitria, ChiLin shall use commercially reasonable efforts
                  to promptly remedy any and all defects in the Deliverables
                  that cause a breach of warranties set forth in this Agreement,
                  including any Statement of Work.

         11.1.4   ChiLin shall defend, indemnify and hold Vitria, its officers,
                  directors, agents, employees, successors and assigns harmless
                  from and against any and all liabilities, losses, costs,
                  damages, and expenses incurred by Vitria and its sublicensees
                  (including without limitation reasonable attorneys' fees)
                  arising out of the breach by ChiLin of the foregoing
                  representations and warranties or by the gross negligence or
                  willful misconduct of ChiLin provided that (a) Vitria giving
                  timely written notice of any claim to ChiLin, (b) Vitria
                  providing, at ChiLin's expense, any assistance which ChiLin
                  may reasonably request for the defense of the claim, and (c)
                  ChiLin having control of the defense; provided, however, that
                  ChiLin may not settle or compromise any claim in a manner that
                  does not unconditionally release Vitria and its sublicensees
                  from liability or that limits Vitria's rights in the
                  Deliverables, absent Vitria's prior written consent on a
                  case-by-case basis.

11.2     Vitria Indemnity.

         11.2.1   Vitria represents and warrants Vitria has full, unimpeded
         power and right to perform all of the terms of this Agreement.

         11.2.2   Vitria represents and warrants that

                  i)       All software code, documentation, and other materials
                           developed for, created or delivered to ChiLin
                           pursuant to this Agreement do not contain,
                           misappropriate or infringe any third party trade
                           secret or other intellectual property, right or other
                           right of any kind, and that there are no liens,
                           claims or encumbrances of any kind on such software
                           code, documentation, and other materials in any way
                           or of any kind, but only to the extent that such
                           misappropriation or infringement

                  ii)      Vitria has full power and right to perform all other
                           terms of this Agreement; and any distribution or use
                           by ChiLin of any other software code, documentation
                           or other materials provided to ChiLin under this
                           Agreement will not violate or interfere with the
                           intellectual property or contractual rights of any
                           third party, including without limitation, those
                           rights arising under copyright, trademark, trade
                           secret or patent law,

         11.2.4   Vitria shall defend, indemnify and hold ChiLin, its officers,
                  directors, agents, employees, successors and assigns harmless
                  from and against any and all liabilities, losses, costs,
                  damages, and expenses incurred by ChiLin and its sublicensees
                  (including without limitation reasonable attorneys' fees)
                  arising out of the breach by Vitria of the foregoing
                  representations and warranties or by the gross negligence or
                  willful misconduct of Vitria provided that (a) ChiLin giving
                  timely written notice of any claim to Vitria, (b) ChiLin
                  providing, at Vitria's expense, any assistance which Vitria
                  may reasonably request for the defense of the claim, and (c)
                  Vitria having control of the defense; provided, however, that
                  Vitria may not settle or compromise any claim in a manner that
                  does not unconditionally release ChiLin and

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                                                            VITRIA CONTRACT 8511

                  its sublicensees from liability or that limits ChiLin's rights
                  in the Deliverables, absent ChiLin's prior written consent on
                  a case-by-case basis.

         11.3     MUTUAL OBLIGATIONS. Each party shall indemnify, defend and
         hold harmless the other, its employees, principals (partners,
         shareholders or holders of an ownership interest, as the case may be)
         and agents, from and against any third party claims, demands, loss,
         damage or expenses (including counsel fees and expenses) relating to
         bodily injury or death of any person or damage to real and/or tangible
         personal property directly caused by the gross negligence or willful
         misconduct of the indemnifying party, its personnel or agents in
         connection with the performance of the Services hereunder.

12.0     LIMITATION OF LIABILITY

12.1     EXCEPT FOR THE INDEMNIFICATION OBLIGATIONS OF EITHER PARTY UNDER
         SECTION 11.0 ABOVE AND FOR BREACHES BY EITHER PARTY OF THE TERMS AND
         CONDITIONS OF SECTION 10 (NONDISCLOSURE), IN NO EVENT WILL EITHER PARTY
         BE LIABLE TO THE OTHER FOR ANY INDIRECT, CONSEQUENTIAL, EXEMPLARY OR
         INCIDENTAL DAMAGES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
         POSSIBILITY OF SUCH DAMAGES, AND WHETHER ARISING IN TORT, NEGLIGENCE,
         STRICT LIABILITY, CONTRACT, OR OTHERWISE, PROVIDED, HOWEVER, THAT IN NO
         EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR SUCH DAMAGES
         IN EXCESS OF FIVE MILLION DOLLARS ($5,000,000).

12.2     EXCEPT FOR THE INDEMNIFICATION OBLIGATIONS OF EITHER PARTY UNDER
         SECTION 11.0 ABOVE AND FOR BREACHES BY EITHER PARTY OF THE TERMS AND
         CONDITIONS OF SECTION 10 (NONDISCLOSURE), EACH PARTY'S LIABILITY FOR
         DIRECT DAMAGES TO THE OTHER PARTY FOR A CLAIM OF ANY KIND RELATED TO
         THIS AGREEMENT, WHETHER FOR BREACH OF CONTRACT OR WARRANTY, STRICT
         LIABILITY, NEGLIGENCE OR OTHERWISE, SHALL NOT EXCEED THE AGGREGATE OF
         FEES PAID TO CHILIN FOR THE PRODUCT OR SERVICE INVOLVED IN THE CLAIM.

13.0.    TERM AND TERMINATION

13.1     This Agreement will become effective on the Effective Date and will
         remain in effect for an initial period of five (5) years from the
         Effective Date. The term of this Agreement shall automatically renew
         thereafter for one year periods; provided, however, that ChiLin may
         give Vitria written notice of its intent not to renew the Agreement no
         earlier than six (6) months prior to the expiration of the initial term
         or any subsequent term of the Agreement; provided that no work remains
         to be performed under an existing Statement of Work that would extend
         beyond the expiration date.

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                                                            VITRIA CONTRACT 8511

13.2     Vitria may, upon written notice to ChiLin, terminate this Agreement at
         any time at its convenience which termination will be effective thirty
         (30) days after receipt of notice), and in such case, Vitria's
         obligations shall be limited to a payment calculated as follows: Any
         amounts due in connection with the provision of the Deliverables and/or
         the Services through the effective date of termination, plus (a) the
         remaining development fee for the relevant Statements of Work, as fixed
         or estimated in such Statements of Work, divided by the total projected
         days of work required for the completion of the Deliverables as set
         forth in each such Statement of Work, multiplied by the actual days
         worked up to the point of termination with respect to each Statement of
         Work, Notwithstanding anything to the contrary in the preceding
         sentence, the amounts due from Vitria to ChiLin for early termination
         of a Statement of Work whose costs are based solely on a time and
         materials basis shall be calculated as the actual time and material
         expended as of the date of such termination. No Acceptance Testing will
         be required beyond the date of the written notice of termination.

13.3     Without prejudice to any rights either party may have under this
         Agreement or in law, equity or otherwise, either party shall have the
         right to terminate this Agreement if the other party defaults in the
         performance of any of its obligations or breaches any term, provision,
         warranty, or representation under this Agreement and fails to correct
         the Default or to commence any and all steps reasonably necessary to
         cure such Default within thirty (30) days of receipt of written notice
         of such default by the non-defaulting party.

13.4     Should either party become the subject of any proceeding under
         provincial, state or federal law for due relief of debtors or otherwise
         become insolvent or bankrupt or make an assignment for the benefit of
         creditors, the other party may, in addition to any other right or
         remedy it may have, terminate this Agreement without liability to the
         non-defaulting party upon written notice; provided, however, that
         neither party shall be deemed in default for delays due to causes
         beyond its reasonable control.

13.5     Upon termination of this Agreement, ChiLin shall thereafter cease to
         use (i) any Vitria software provided under this Agreement and (ii) any
         copies of the Deliverables, and shall delete such Deliverables and
         Vitria software from its library, and shall return to Vitria or destroy
         all copies of such Deliverables, and shall notify Vitria in writing
         that this has been done; provided, however, that notwithstanding the
         foregoing, ChiLin shall be entitled to retain a single copy of the
         Deliverables and Vitria software for archival, maintenance and support
         purposes, and not for enhancement or development.

13.6     The provisions of Sections 9 (Ownership), 10 (Nondisclosure), 11
         (Warranty/Indemnification), 12 (Limitation of Liability), 13 (Term and
         Termination) and 14 (Miscellaneous) shall survive termination of this
         Agreement.

14.      MISCELLANEOUS

14.1     Appendices; Counterparts. All recitals and appendices are hereby
         incorporated into this Agreement. This Agreement may be executed in any
         number of counterparts and/or duplicate originals.

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                                                            VITRIA CONTRACT 8511

14.2     Assignment. ChiLin may not assign this Agreement without the prior
         written consent of Vitria. Any purported assignment in contravention of
         this section is null and void. A transfer of a controlling interest in
         the equity of ChiLin shall be deemed an assignment for purposes of this
         subsection. Subject to the foregoing, this Agreement will bind and
         inure to the benefit of any successors or assigns.

14.3     Attorneys' Fees. The prevailing party in any suit under this Agreement
         shall recover all costs, expenses and reasonable attorney fees incurred
         in such action.

14.4     Controversies. Before either party commences any action against the
         other party, it shall give written notice to the other party of its
         intention to file a claim, and the senior management of the parties
         then shall meet in good faith to resolve the dispute.

14.5     Definitions and Section Headings. Singular terms shall be construed as
         plural, and vice versa, where the context requires. Section headings
         are a matter of convenience and shall not be considered part of this
         Agreement.

14.6     Entire Agreement. This Agreement is the complete and exclusive
         statement of the understandings of the parties, and it supersedes and
         merges all prior proposals and understandings, whether oral or written,
         relating to the subject matter of this Agreement. This Agreement may
         not be modified except in writing, signed by an officer of Vitria and a
         duly authorized representative of ChiLin, and expressly referring to
         this Agreement. This Agreement takes precedence over any purchase order
         issued by either party, which may accepted by the other party for
         administrative convenience only.

14.7     Export. The parties shall comply with the Export Laws. Neither party
         will export or re-export directly or indirectly (including via remote
         access) any part of the Deliverables, Vitria Owned Technology, Vitria
         Owned Modifications, ChiLin Technology, ChiLin Owned Modifications or
         any Confidential Information to any country for which a validated
         license is required under the Export Laws without first obtaining a
         validated license.

14.8     Force Majeure. Neither party will be responsible for failure of
         performance, other than for an obligation to pay money, due to causes
         beyond its control, including, without limitation, acts of God or
         nature; labor disputes; sovereign acts of any federal, state or foreign
         government; or shortage of materials.

14.9     Governing Law. This Agreement shall be governed by and construed in
         accordance with the laws of the State of California, but without giving
         any effect to the choice of law principles thereunder.

14.10    Independent Contractors; Nonexclusive. Vitria and ChiLin are
         independent contractors and will so represent themselves in all
         regards. Neither party may bind the other in any way. Nothing in this
         Agreement will be construed to make either party the agent or legal
         representative of the other or to make the parties partners or joint
         venturers.

14.11    Notices. All notices, consents and approvals under this Agreement must
         be delivered in writing by courier, or by certified or registered mail
         (postage prepaid and return receipt requested), to the other party at
         the address set forth beneath such party's signature, and will be
         effective upon receipt or three (3) business days after being deposited
         in the mail as required above, whichever occurs sooner. Either party
         may change its address by giving notice of the new address to the other
         party.

                                                                   Page 13 of 15

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                                                            VITRIA CONTRACT 8511

14.12    Severability. If any provision of this Agreement is found by a court of
         competent jurisdiction to be invalid or unenforceable, the remainder of
         the Agreement shall continue in full force and effect. However, should
         either party reasonably conclude that a provision held to be invalid or
         unenforceable was a material inducement to its entering into this
         Agreement, and the loss of that provision has deprived it of the
         benefit of the bargain reached upon execution of this Agreement, then
         that party may, upon 10 days prior written notice, terminate this
         Agreement.

14.13    Waiver. The waiver of one breach or default shall not constitute the
         waiver of any subsequent breach or default, and shall not act to amend
         or negate the rights of any party.

                                                                   Page 14 of 15

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                                                            VITRIA CONTRACT 8511

The parties have executed duplicate originals of this Agreement, by their duly
authorized representatives.

ChiLin:                                  Vitria:

c/o Mayer, Brown, Rowe & Maw LLP         Vitria Technology, Inc.
Two Palo Alto Square                     945 Stewart Drive
3000 El Camino Real                      Sunnyvale, CA 94085
Palo Alto, CA 94306                      Attn: General Counsel
Attention: Martin J. Collins

/s/ JoMei Chang                          /s/ Jeffrey J. Bairstow
-------------------------------          ----------------------------
(Signature)                              (Signature)

JoMei Chang                              Jeffrey J. Bairstow
-------------------------------          ----------------------------
(Printed Name/Title)                     (Printed Name/Title)

December 31, 2003                        December 31, 2003
-------------------------------          ----------------------------
(Date)                                   (Date)

                                                                   Page 15 of 15