Exhibit 10.05



 



CONFIDENTIAL TREATMENT REQUESTED

EXHIBIT 10.05




MASTER AGREEMENT

Between INTUIT INC. and MODUS MEDIA INTERNATIONAL, INC.


ARTICLE 1

PARTIES


Section 1.1 Parties to the Agreement


     THIS MASTER AGREEMENT (herein “Master Agreement” or “Agreement”) for
services,
effective November 1, 2000 (herein the “Effective Date”) is between INTUIT Inc.
(herein “INTUIT”), a Delaware corporation located at 2535 Garcia Avenue,
Mountain View, CA 94043, and MODUS MEDIA International, Inc., incorporated in
Delaware (herein “MODUS MEDIA”), located at 690 Canton Street, Westwood, MA
02090.


     In consideration of the mutual covenants contained herein, the parties
hereby agree as follows:


ARTICLES 2

SERVICES


Section 2.1 Enterprise Members


     Under this Agreement, INTUIT shall mean Intuit Inc. and any affiliate of
INTUIT and all subsidiaries and related companies, that INTUIT controls by
ownership of 45% or greater equity interest, or controls the day-to-day
management of such companies by contract or otherwise, solely in connection
with INTUIT’s relationship with such entity, provided such related company is
not a direct competitor of MODUS MEDIA. See Schedule A for the comprehensive
list of the Enterprise Members, which may be amended form time to time by
written notice from INTUIT and MODUS MEDIA.


Section 2.2 Statement of Work


     INTUIT, in its sole discretion, may engage MODUS MEDIA to perform services
under a statement of work agreed to and signed by the parties (herein
“Statement of Work”). MODUS MEDIA will provide the services (herein “Service”)
as outlined in the Statement if Work. MODUS MEDIA will also provide such
additional related services as are set out in such Statement of Work (herein
“Related Services”). All terms and conditions contained in this Master
Agreement apply to the Statement of Work. Any new Statement of Work introduced
during the Term of this Agreement may be incorporated into this Agreement if
both parties agree in writing to do so.


Section 2.3 Approved Facility


     For business based in the United States and Canada, MODUS MEDIA will
utilize a U.S. based facility or facilities (herein “Approved Facility”) for
the delivery of Services for the Statement of Work. The Facility will be
equipped with telephone systems, computer systems, and various MODUS MEDIA
support tools, such as documentation and knowledge bases, to be used in the
delivery of Services.


1



*     We have requested confidential treatment for certain portions of this
document pursuant to an application for confidential treatment sent to the
Securities and Exchange Commission (SEC). We omitted such portions from this
filing and filed them separately with the SEC.









 


     For business based in the Asia/Pacific Rim region, MODUS MEDIA may utilize
a facility in Singapore. For the European based business, MODUS MEDIA may
utilize its facility located in Apeldoorn, The Netherlands and or Kildare,
Ireland. The parties may add, delete, or change an Approved Facility at any
time through a signed Amendment to this Master Agreement.


Section 2.4 Quarterly Reviews


     Both parties agree to conduct quarterly business reviews to analyze the
ability of MODUS MEDIA to meet INTUIT’s service requirements. These reviews
will be conducted in a mode (conference call, personal visit, etc) agreed upon
by both parties. Specific dated and time for the Reviews will be schedule at
least one month prior to event. These reviews will also be utilized to assist
INTUIT in improving the overall service levels that they provide for their
customers. INTUIT shall be responsible to provide a completed Quarterly
Business Review scorecard that will be used to document and rate MMI’s
performance in all previously agreed metrics, to be set forth in the applicable
SOW.


Section 2.5 Use Of INTUIT Resources


     If given authorization to utilize INTUIT resources, MODUS MEDIA agrees to
use the resources strictly for performing the Services hereunder. “INTUIT
resources” means INTUIT’s employees and agents, and INTUIT’s tangible and
intangible property. Any other or unauthorized use will subject MODUS MEDIA to
immediate termination without further payment. Upon such termination,
INTUIT
does not waive any possible legal action arising from the unauthorized use of
INTUIT resources.


ARTICLE 3

SERVICES


Section 3.1 Orders


     An order (herein “INTUIT Order”) is defined as a single request for
services under any Statement of Work. To order Services under a Statement of
Work, INTUIT shall issue a purchase order under the referenced Statement of
Work for the Services to be performed by MODUS MEDIA. The terms and conditions
of this Master Agreement and the referenced Statement of Work shall govern the
Services and any printed terms and conditions on the purchase order or
acceptance forms shall not apply. MODUS MEDIA shall examine the INTUIT Order
and shall ask INTUIT for clarification if there is any ambiguity. MODUS MEDIA
shall not perform Services without an INTUIT Order and with proper
instructions. Services shall commence on the dated indicated in the INTUIT
Order.


Section 3.2 Delays in Shipping.


     Delays in shipping shall be reported immediately by MODUS MEDIA to INTUIT.
MODUS MEDIA shall report the source of the delay, the expected time to correct
the delay, the status of work in process, and the cost of the work in process.
INTUIT reserves the right to cancel any order resulting from this Agreement in
whole or in part if MODUS MEDIA fails to make deliveries in accordance with the
terms of an INTUIT Order and this Agreement. If INTUIT cancels any order


2








 



under this section, MODUS MEDIA shall complete any work in process and
INTUIT shall pay for such work in process based upon cost of the work in
process reported by MODUS MEDIA to INTUIT (but not more than the actual cost of
the work in process) and the other terms and conditions of this Agreement.


Section 3.3 Changes


     INTUIT may order changes in the Service under a Statement of Work, All
changes shall be evidenced by an executed Change Order form referencing the
original purchase order number and Statement of Work. If adjustments to
compensation are required, they shall be described in the Change Order. The
terms and conditions are governing the Services shall continue in full force
and effect except as expressly amended in the Change Order. If INTUIT knows it
will experience a delay after the dated Services are scheduled to commence and
requests MODUS MEDIA to remain on standby during that delay, INTUIT will
reimburse MODUS MEDIA for reasonable standby costs as agreed to by the parties
prior to commencement of the delay and described in a Change Order.


ARTICLE 4

INSURANCE


Section 4.1 Insurance


     A) In the event MODUS MEDIA is to perform work on INTUIT’s premises, MODUS
MEDIA shall take out and maintain the following minimum insurance at its
expense for the duration of any work preformed under this Agreement for each
such location:



	 	 	 
	a)   Worker’s Compensation
	 	
Statutory

	b)   Employer’s Liability
	 	
$1,000,000 each occurrence

	c)   Comprehensive General Liability

   (Bodily Injury)
	 	
$2,000,000 each occurrence

	d)   Comprehensive General Liability

   (Property Damage)
	 	
$2,000,000 each occurrence

	e)   Comprehensive Automobile Liability

   (Bodily Injury)
	 	
$1,000,000 each occurrence

	f)   Comprehensive Automobile Liability
	 	
$1,000,000 each occurrence




MODUS MEDIA shall have full and exclusive liability for the payment of, and
MODUS MEDIA shall pay, any and all taxes and contributions for unemployment
insurance, old age retirement benefits, workers’ compensation insurance or
benefits, life insurance, pensions, annuities and similar benefits and any
other employment-related costs, obligations, and duties that may now or
hereafter be imposed by law, collective bargaining agreements or otherwise with
respect to persons employed by MODUS MEDIA for the performance of Services
under this Agreement.


INTUIT to be named as an additional insured on the above policy(ies), except
for Worker’s Compensation. The public liability insurance specified in sections
c) and d) hereinabove shall include coverage for MODUS MEDIA’s contractual
liability under Indemnity with limits not less than those set forth
hereinabove. Every contract of insurance providing the coverage required
herein shall contain the following clause: “No reduction, cancellation or
expiration of this policy shall become effective until ten (10) business days
from the date written notice is


3








 



actually received by INTUIT.” MODUS MEDIA shall not undertake any Work on
INTUIT’s premises until all required insurance has been obtained and
certificates confirming such coverage has been furnished to and approved by
INTUIT.


MODUS MEDIA shall mail a certificate of insurance to the Intuit Purchasing
Department, Attention: Director, Software Operations, within ten (10) days of
receipt of the first purchase order placed under this Agreement. Mail to: 2700
C. Coast Avenue, Mountain View, CA 94043


ARTICLE 5

INVOICING AND PAYMENT


Section 5.1 Invoicing and Payment


     MODUS MEDIA will invoice INTUIT as services are rendered and on no less
than a weekly basis. MODUS MEDIA will provide separate invoices for operations
in Lindon, Utah and Raleigh, North Carolina, and any other operating divisions
performing services for INTUIT. In addition, MODUS MEDIA will bill and INTUIT
will pay for Related Services and such other charges as are provided for herein
on an as-incurred basis. Charges for Related Services not specifically
provided for in this Agreement or the Statement of Work MUST be approved by
INTUIT in advance of being incurred, otherwise INTUIT is under no obligation to
pay unapproved expenses. INTUIT will pay MODUS MEDIA upon the following terms:
net thirty (30) days from receipt of the invoice unless otherwise set forth in
the applicable SOW. Notwithstanding the foregoing, the parties shall discuss
superseding the prior provision and having INTUIT make payments by means of a
Procurement Master Card credit card. In the event of a disputed invoice,
INTUIT will pay the portion of the invoice that is not disputed, and will
promptly pay the disputed portion once resolved.


Section 5.2 Application Sales Tax


     Invoices will include local, state or federal sales, use or other similar
taxes or duties, if application. MODUS MEDIA will be responsible for the proper
computation and invoicing of sales taxes. Once submitted to INTUIT, INTUIT
shall be responsible for the payment of any such taxes.


Section 5.3 Limitation Period on Invoices


     Any and all invoices for Services must be submitted to the Intuit Accounts
Payable Department within six (6) months of date such Services are rendered.
Any invoices not received within the six (6) month timeframe shall be deemed to
be forgiven by MODUS MEDIA. Similarly, INTUIT cannot dispute any invoice or
portion thereof, paid or unpaid, more than six (6) months after the invoice
date. This provision shall not apply to invoices relating to aged inventory,
which is invoiced periodically as set forth in this Agreement or the applicable
SOW.


Section 5.4 Liens


     MODUS MEDIA shall keep INTUIT property free and clear of all third party
liens, claims, and encumbrances arising from the performance of the Services
provided under this Agreement by MODUS MEDIA. Before receiving payment for its
Services, MODUS MEDIA shall certify and provide proof satisfactory to INTUIT
that all material and equipment embodied in the work and all labor costs
incurred on the work have been fully paid and discharged.


4








 


     If any lien is filed, MODUS MEDIA shall promptly procure the release of
such lien. MODUS MEDIA shall have the right to contest the validity or amount
of any such lien; however, pending the discharge of any such lien of record,
INTUIT may retain out of any monies that are due and payable to MODUS MEDIA an
amount sufficient to discharge such lien and to reimburse INTUIT for any cost
or expense incurred in any action or proceeding for the enforcement or removal
of the lien. MODUS MEDIA agrees to reimburse INTUIT for all monies paid and
expenses incurred by INTUIT in discharging such liens or otherwise incurred in
connection with any action or proceeding for the removal or enforcement of the
lien.


MODUS MEDIA shall include a provision satisfying the requirements of this
clause as part of any and all subcontracts entered into for the work or any
portion of the work.


ARTICLE 6

TERM AND TERMINATION


Section 6.1 Term


     This agreement shall become effective as of 11/1/00 and shall continue
until either party provides at least ninety (90) days notice of its intent to
terminate the Agreement.


Section 6.2 Termination Based on Non-Performance


     6.2.1 If MODUS MEDIA fails to perform the Services described in the
referenced Statement of Work under an INTUIT Order in a timely manner or fails
to perform any material provision of the Master Agreement of Statement of Work,
MODUS MEDIA shall immediately take appropriate steps to perform such Services
or to cure such failure. If MODUS MEDIA fails to cure the failure immediately
and such failure causes a major impact on INTUIT’s business operations (i.e. an
impact causing immediate and material harm to INTUIT’s business operations),
INTUIT will provide a written warning to MODUS MEDIA. MODUS MEDIA will provide
INTUIT reasonable assurances of future performance in writing within one (1)
day and continue to work on the problem until it is resolved within seven (7)
days of such written warning. If the failure cannot reasonably be cured within
seven (7) days, MODUS MEDIA shall so notify INTUIT and commence to cure the
failure immediately and diligently and in good faith continue to cure the
failure. Not withstanding any cure period, if INTUIT deems it necessary, in its
sole discretion, INTUIT may move the Services to another vendor without
liability to MODUS MEDIA during the cure period until such failure is cured.


     6.2.2 If the failure to perform the Services described in the application
Statement of Work under an INTUIT Order or breech of a provision of the Master
Agreement or Statement of Work causes a minor impact on INTUIT’s business
operations, INTUIT shall give MODUS MEDIA written warning of such breach, and
MODUS MEDIA must cure and maintain such cure within thirty (30) days of the
receipt of the notice by MODUS MEDIA . If the failure cannot reasonably be
cured within thirty (30) days, MODUS MEDIA shall so notify INTUIT and commence
to cure the failure immediately and diligently and in good faith continue to
cure the failure. Notwithstanding any cure period, if INTUIT deems it
necessary, in its sole discretion, INTUIT may move all or part of the Services
to another vendor without breach of this Agreement or liability to MODUS MEDIA
during the cure period until such failure is cured. INTUIT may terminate this
Agreement and/or any Statement of Work upon written notice if MODUS MEDIA fails
to cure such breach within the cure period or such longer period of time as may
be agreed by the parties.


5








 


     6.2.3 MODUS MEDIA shall have the right to charge interest at the rate of
twelve (12%) per annum under this Agreement until INTUIT remedies any payment
delinquency. MODUS MEDIA may terminate this Agreement upon forty-five (45) days
written notice if INTUIT fails to pay an undisputed invoice on two or more
occasions within one (1) year or if INTUIT otherwise commits a material breach
of this Agreement and does not remedy such breach within thirty (30) days of
receipt of written warning from MODUS MEDIA.


     6.2.4 Notwithstanding anything to the contrary in this Agreement, INTUIT
may, at any time and at its sole convenience, with or without cause, terminate
all or a portion of the Services in a particular INTUIT Order for Services
under a Statement of Work by giving written notice to MODUS MEDIA specifying
the date of termination. Should INTUIT terminate an INTUIT Order, MODUS MEDIA
shall immediately stop its performance required under such Order and shall
immediately cause any of its suppliers or subcontractors to cease such work as
soon as possible.
Upon receipt and verification of MODUS MEDIA’s invoice, INTUIT shall pay MODUS
MEDIA all amounts properly due owing up to that date, including the fees for
the Order under the Statement of Work reflecting the work in process begun
prior to the effective date of termination plus actual direct costs resulting
from such termination. MODUS MEDIA shall not be paid for any work done after
effective date of termination nor for any cost of MODUS MEDIA or of its
suppliers or subcontractors which MODUS MEDIA could reasonably have voided. If
INTUIT provides MODUS MEDIA with a written request to perform tasks as are
necessary to demobilize the Services after the termination date,


MODUS MEDIA will perform such tasks and be compensated accordingly, as agreed
to by both parties.


     Section 6.3 Termination Without Cause


     Either party shall also have the right to terminate this agreement without
cause, for any reason, by providing one hundred and twenty (120) days’ notice
to the other party.


     Section 6.4 Termination due to Bankruptcy


     Either party shall also have the right to terminate the Agreement for
cause if the other party becomes insolvent, files or has filed against it a
petition under application bankruptcy or insolvency laws which is not dismissed
within sixty (60) days, proposes any dissolution, composition or financial
reorganization with creditors, makes an assignment for the benefits of
creditors, or if a receiver, trustee, custodian or similar agent is appointed
or takes possession with respect to any property or business of the defaulting
party.


     Notwithstanding anything to the contrary in this Agreement, if MODUS MEDIA
shall file for protection under the bankruptcy laws, or if an involuntary
petition shall be filed against MODUS MEDIA and not removed within ten (10)
days, or if the MODUS MEDIA shall become insolvent, be adjudicated bankrupt, or
if it should make a general assignment for the benefit of creditors, or if a
receiver shall be appointed due to its insolvency, INTUIT may, without
prejudice to any other right or remedy, terminate the Agreement, any Statement
of Work and any INTUIT Order and, at its option may take possession of the
“Work in Process” and finish the manufacture by whatever appropriate method
INTUIT may deem expedient. To the extent reasonably possible, finished Products
shall be stored separately from other stock and marked conspicuously with
labels indicating ownership by INTUIT.


     To secure INTUIT’s progress payment prior to the shipment of the products,
title to and first security interest in the product, any Work in Process, and
materials required for the execution of


6








 



MODUS MEDIA’s obligations under this Agreement and any work which MODUS MEDIA
may subcontract in support of the performance of its obligations under this
Agreement, shall vest in INTUIT to the extent INTUIT had made progress payments
under this Agreement.


     The parties hereby agree that this Agreement shall constitute the Security
Agreement required by the Uniform Commercial Code of the appropriate states.
Each party will execute promptly any financing statement required to perfect
and protect the interest of the other as defined in this Agreement.


     Section 6.5 Obligations Upon Termination or Expiration.


     The termination or expiration of this Master Agreement shall in no way
relieve either party from its obligations to pay the other party any sums
accrued hereunder prior to such termination or expiration of affects the
limitation of liability. All warranties and confidentiality provisions shall
remain in effect for their stated duration.


     Section 6.6 Disaster Recovery


     Notwithstanding any
provision to the contrary, INTUIT and the Enterprise
Members shall have the right to take whatever reasonable actions are necessary,
without liability to MODUS MEDIA, except for Services actually performed, in
the event of a disaster (a) for the duration of a disaster and (b) for the
purpose of keeping its business functioning, Disaster shall mean an unplanned
interruption (a) in the ability of INTUIT and/or Enterprise Members to use the
Services of MODUS MEDIA due to a cause beyond the control of INTUIT and /or
Enterprise Member, which at the time of occurrence can reasonably be projected
to last over four (4) hours or (b) in telecommunications to or from one or more
of INTUIT’s and/or the Enterprise Member, which at the time of occurrence can
reasonably be projected to last over four (4) hours.


ARTICLE 7

INDEMNIFICATION


     Section 7.1 Patent and Copyright Indemnification by INTUIT


     7.1.1 “Intellectual Property Rights” means any of INTUIT’s patent, trademarks,
trade names, inventions, copyrights, design rights, know-how or trade secrets
and any other intellectual property rights of INTUIT subsisting anywhere in the
world, relating to the origin, design, manufacture, programming, operation or
service of any INTUIT products.


     7.1.2 MODUS MEDIA acknowledges INTUIT’s representation that all Intellectual
Property Rights throughout the world are vested in INTUIT absolutely, and
acknowledges that MODUS MEDIA has no right or interest in any Intellectual
Property Rights.


     7.1.3 The “Territory” consists of the countries in which MODUS MEDIA performs
Services for INTUIT and the countries into which MODUS MEDIA sells or
distributes INTUIT products on INTUIT’s behalf, under this Agreement.


7








 


     7.1.4 INTUIT shall, at its own expense, defend MODUS MEDIA against all claims, suits,
losses, expenses and liabilities (including MODUS MEDIA’s reasonable attorney’s
fees) or arising out of any claim alleging that any INTUIT products sold or distributed by MODUS
MEDIA on INTUIT’s behalf hereunder infringes any duly issued patent or
copyright of the United States or the Territory and shall pay all damages
awarded therein against MODUS MEDIA or agreed upon in settlement by INTUIT;
provided that MODUS MEDIA (i) gives INTUIT notice in writing of any such suit,
proceeding or threat thereof, (ii) permits INTUIT sole control, through counsel
of INTUIT’s choice, to defend and/or settle such suit and (iii) give INTUIT all
reasonably necessary information, assistance and authority, at INTUIT’s
expense, to enable INTUIT to defend or settle such suit.


     7.1.5 Subsection 7.1.4, above, shall not apply to and INTUIT shall have no liability or
obligation for any infringement arising from: (a) any modification, servicing
or additional made to the INTUIT products by anyone other than INTUIT or its
representative or agent, (b) the use of such INTUIT products as a part of or
in combination with any devices, parts or software not provided by INTUIT, (c)
compliance with MODUS MEDIA’s design requirements or specifications, (d) the use of
other than the then current unaltered release of the software INTUIT products
available from INTUIT or (e) the use of such INTUIT products to practice any
method or process which does not occur wholly within the INTUIT products. The
above exclusions apply to the extent that the infringement would have been
avoided but for such modifications, combinations, compliance with
specifications, used of other than the current release or practice of such
method or process.


     7.1.6 In the event the use or sale of any INTUIT product distributed by
MODUS MEDIA in accordance with the Statement of Work for the Fulfillment
Services provided under the Master Agreement is enjoined, or in the event
INTUIT wishes to minimize its potential liability hereunder, INTUIT may, at its
sole option and expense: (i) procure for MODUS MEDIA the right to use or
distribute such INTUIT products; (ii) substitute a functionally equivalent,
non-infringing unit of the equivalent in functionality; or (iv) if none of the
foregoing are commercially feasible, take back such INTUIT product and not
distribute the product.


     7.1.7 THIS SECTION
STATES INTUIT’S TOTAL RESPONSIBILITY AND LIABILITY, AND
MODUS MEDIA’S SOLE REMEDY, FOR ANY ACTUAL OR ALLEGED INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS FOR ANY INTUIT PRODUCTS DELIVERED HEREUNDER OR ANY
PART THEREOF AND IS IN LIEU OF AND REPLACES ANY AND ALL OTHER
EXPRESS, IMPLIED
OR STATUTORY WARRANTIES OR CONDITIONS REGARDING INFRINGEMENT.


     Section 7.2 General Indemnity by INTUIT


     INTUIT shall, at its own expense, defend MODUS MEDIA against all claims,
suits, losses, expenses and liabilities (including MODUS MEDIA’s reasonable
attorney’s fee) for or arising out of any claim alleging personal injury,
death, or damage to tangible property caused by INTUIT or as the result of the
negligence or intentional wrongful acts or omissions, when there is a duty to
act of awarded therein against MODUS MEDIA or agreed upon in settlement by
INTUIT, provided that MODUS MEDIA gives INTUIT immediate notice in writing of
any such suit, proceeding, or threat thereof, and permits INTUIT, through
counsel of its choice, to answer the charges and defend and/or settle such
suit; MODUS MEDIA gives INTUIT all reasonable necessary information, that is
available to it, and all needed assistance and authority, at INTUIT’s expense,
to enable INTUIT to defend or settle such suit.


     Section 7.3 Indemnity by MODUS MEDIA


8








 


     MODUS MEDIA shall, at its own expense, indemnify and defend INTUIT against
all claims, suit, losses, expenses, and liabilities (including
INTUIT’s
reasonable attorney fees) for personal injury, death and tangible property
damages made against INTUIT caused by MODUS MEDIA or as a result of the
negligence, intentional wrongful acts or omissions, or misrepresentations of
MODUS MEDIA or any person for whose actions MODUS MEDIA is legally liable.


     MODUS MEDIA shall pay all damages awarded therein against INTUIT or agreed
upon in settlement by MODUS MEDIA relating to this indemnity, provided that
INTUIT gives MODUS MEDIA notices in writing of any such suit, proceeding, or
threat thereof, and permits MODUS MEDIA, through counsel of its choice, to
answer the charges and defend and or settle such suit; and INTUIT gives MODUS
MEDIA all reasonably necessary information that is available to it
and assistance and authority, at MODUS MEDIA’s expense, to enable MODUS MEDIA to
defend or settle such suit.


ARTICLE 8

LIMITATION OF LIABILITY


     Section 8.1 Limitation of Liability


     EXCEPT FOR LIABILITIES ARISING FROM BREACH OF SECTIONS 7.1 OR 10.1, TO THE
FULL EXTENT ALLOWED BY LAW, THE PARTIES EXCLUDED ANY LIABILITY TO THE OTHER
WHETHER BASED IN CONTRACT OR TORT (INCLUDING NEGLIGENCE). FOR INCIDENTAL,
CONSEQUENTIAL, INDIRECT, SPECIAL OR PUNITIVE DAMAGES OF ANY KIND, OR FOR LOSS
OF REVENUE OR PROFITS, LOSS OF BUSINESS, UNDER THIS AGREEMENT.


     Section 8.2 Limitation of Damages


     NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, THE MAXIMUM
LIABILITY OF EITHER PARTY TO THE OTHER FOR DAMAGES HEREUNDER SHALL NOT EXCEED
THE TOTAL COST OF REPLACING THE PRODUCT GIVING RISE TO THE CLAIM, EXCEPT THAT
THIS LIMITATION SHALL NOT APPLY TO AMOUNTS OWED FOR SERVICES PROVIDED AND
UNPAID UNDER THIS AGREEMENT, DAMAGES ARISING FROM BREACH OF SECTIONS 7.1 OR
10.1.


9








 


ARTICLE 9

WARRANTY AND WARRANTY DISCLAIMERS


     Section 9.1 Warranty


     MODUS MEDIA represents and warrants that the Services furnished under an
INTUIT Order shall comply with and conform to all specifications in the
Statement of Work, to the best of MODUS MEDIA’s knowledge will be free of
defects in material and workmanship, and that it will provide the Services
under the Agreement in a workmanlike manner by competent personnel and in
conformance with generally accepted standards within its industries. MODUS
MEDIA warrants and represents that is shall comply will all federal, state and
local laws. MODUS MEDIA further warrants and represents to INTUIT that MODUS
MEDIA shall keep the equipment and appliances needed to provide Services under
an INTUIT Order in such condition as is required to perform their normal
operations and for Modus Media to perform the Services in accordance with this
Agreement. If any repairs or alterations must be made at any time MODUS MEDIA’s
equipment or appliances in order to prevent or remedy a breach of the foregoing
warranty, MODUS MEDIA will immediately undertake such repair or alteration. In
the event MODUS MEDIA is in breach of this section, INTUIT’s initial remedy
shall be to report the breach to MODUS MEDIA, and MODUS MEDIA shall cure the
breach by either repairing or replacing the defective Product or by
reperforming the Services, whichever is applicable, in accordance with the
provisions and the timetables described in Section 6.2.


     Section 9.2 Warranty Disclaimers


     TO THE FULL EXTENT ALLOWED BY LAW, MODUS MEDIA DISCLAIMS ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATIONS, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH
RESPECT TO ITS SERVICES.


ARTICLE 10

CONFIDENTIALITY, SECURITY AND PUBLICITY


     Section 10.1 Confidentiality


     During the course of this Agreement, each party may disclose to the other
certain proprietary information (both patentable and unpatentable, including
trade secrets, know how, software, source codes, techniques, future product
plans, marketing plans, customers, inventions, discoveries, improvements, and
research and development data) (“Confidential Information”) of a character
regarding by the disclosing party as confidential. Each party and each of its
employees or consultants to whom disclosure is made shall hold all Confidential
Information and the terms of this Agreement in confidence, and shall not
disclose such information to any third party or apply it to uses other than the
recipient’s performance of this Agreement.


     Such Confidential Information if disclosed in writing shall be marked or
identified as confidential or a similar designation, or if orally or visually
disclosed, shall be identified as the confidential information of the
disclosing party at the time of disclosure and then summarized in writing and
provided to the recipient in such written form within thirty (30) days after
such oral or visual disclosure.


10








 



	(a)	  	Obligation of Confidentiality. Each party agrees that for a period of
three (3) years from receipt of Confidential Information from the other
party hereunder, it shall use the same degree of care that it utilizes
to protect its own information of a similar nature, but in any event not
less than reasonable care to prevent the unauthorized use or the
disclosure of such Confidential Information to third parties. The
Confidential Information shall be disclosed only to employees and
consultants of a recipient with a “need to know” who are instructed to
and agree in writing to not disclose third party confidential
information, and who shall use the Confidential Information only for the
purpose set forth above. A recipient may not alter, decompile,
disassemble, reverse engineer, or otherwise modify any Confidential
Information received hereunder and the mingling of the Confidential
Information with information of the recipient shall not affect the
confidential nature or ownership of the same as stated hereunder.
	 
	(b)	  	Ownership of Confidential Information. All Confidential Information is,
and shall remain, the property of the disclosing party. Nothing herein
shall be construed as granting or conferring any rights by license or
otherwise in the Confidential Information except as expressly provided
herein. A recipient acquires hereunder only a limited right to use the
Confidential Information solely for the purpose of performing its
obligations under this Agreement.
	 
	(c)	  	Return of Confidential Information. Upon the written request of the
disclosing party, or upon the expiration or any earlier termination of
this Agreement, the recipient shall promptly return all copies of the
Confidential Information, in whatever form or media, to the disclosing
party or, at the direction of such party, destroy the same. The
recipient shall certify in writing to the other such return or
destruction within thirty (30) days thereafter.
	 
	(d)	  	Exceptions to Obligations of Confidentiality. This Agreement shall
impose no obligation of confidentiality upon a recipient with respect to
any portion of the Confidential Information received hereunder which:




	       	(i)	  	now or hereafter, though no unauthorized act or failure to act on
recipient’s part, becomes generally known or available;
	 
	       	(ii)	  	is lawfully known to the recipient without an obligation of
confidentiality at the time recipient receives the same from the
disclosing party, as evidenced by written records;
	 
	       	(iii)	  	is hereafter lawfully furnished to the recipient by a third party
without restriction on disclosure;
	 
	       	(iv)	  	is furnished to others by the disclosing party without
restriction on disclosure; or
	 
	       	(v)	  	is independently developed by the recipient without use of the
disclosing party’s Confidential Information.




	 	  	       Nothing is this Agreement shall prevent the receiving party from
disclosing Confidential Information to the extent the receiving party is
legally compelled to do so by any



11








 




	 	  	governmental investigative or judicial agency pursuant to
proceedings over which such agency has jurisdiction; provided, however,
that prior to any such disclosure, the receiving party shall:




	       	(a)	  	assert the confidential nature of the
Confidential Information to the agency;
	 
	       	(b)	  	immediately notify the disclosing party in
writing of the agency’s order or request
to disclose; and
	 
	       	(c)	  	cooperate fully with the disclosing party in
protecting against any such disclosure and/or obtaining a
protective order narrowing the scope of the compelled
disclosure and protecting its confidentiality.



     Section 10.2 Security


     MODUS MEDIA shall at all times conduct all operations under this Agreement
in a manner to avoid the risk of loss, theft, or damage by vandalism, sabotage
or other means to any property. MODUS MEDIA shall promptly take all reasonable
precautions which are necessary and adequate to protect against conditions
which involve a risk of loss, theft or damage to its property, INTUIT’s
property, and the work site. MODUS MEDIA shall continuously inspect all its
work, materials, and equipment facilities to discover and determine any of the
above-described conditions and MODUS MEDIA shall be solely responsible for
discovery, determination and correction of any such conditions. MODUS MEDIA
shall cooperate with INTUIT on all security matters and MODUS MEDIA shall
promptly comply with any project security requirements established by INTUIT.
Compliance with these security requirements shall not relieve MODUS MEDIA of
its responsibility for maintaining adequate security, nor shall such compliance
be construed as limiting MODUS MEDIA’s obligation to undertake reasonable
action as required to comply with the terms and conditions of this Agreement.
MODUS MEDIA shall prepare and maintain accurate reports of incidents of loss,
theft or vandalism and MODUS MEDIA shall furnish these reports to INTUIT in a
timely manner. MODUS MEDIA is solely responsible for the safety of its own
personnel.


     Section 10.3 Publicity


     Neither party shall disclose, advertise or publish the terms or conditions
of this Agreement
without the prior written consent of the other party, except as may be required
by law or pursuant to a lawful request of a government agency in which event
the party required to make such disclosure shall notify the other party and
provide the other party with reasonable opportunity to prevent such disclosure.
This Section shall survive the expiration or termination of the Master
Agreement.


ARTICLE 11

GENERAL PROVISIONS


     Section 11.1 Relationship of Parties


     MODUS MEDIA is an independent contractor and represents INTUIT solely for
the purpose of performing its obligations on behalf of INTUIT as stated in this
Master Agreement. MODUS MEDIA does not have the authority to bind INTUIT except
as expressly stated herein. No provision of this Agreement or any act of the
parties under this Agreement shall be construed to express or imply a joint
venture, partnership, or relationship other than vendor and purchaser of the
Services described in this Agreement.


12








 


     Except as expressly noted herein, no employee, agent, or representative of
either party shall have the authority to bind the other party in any way. No
employee, agent, or other representative of either party shall at any time be
deemed to be under the control or authority of the other party, or under the
joint control of both parties, Each party shall be fully liable for all
workers’ compensation premiums and liability, federal, state and local
withholding taxes or charges with respect to its respective employees, and each
agrees to indemnify and defend the others from any claims brought against the
other with respect to such claims.


     Section 11.2 Compliance with Laws


     MODUS MEDIA understands and acknowledges that, in performing any Services
under an INTUIT Order, it may act only on instructions from INTUIT, and shall
take appropriate technical and organizational measures against unauthorized or
unlawful processing of confidential information and against accidental losses
or destruction of, or damage to confidential information.


     MODUS MEDIA shall perform its obligations under this Master Agreement in
compliance with all applicable laws and regulations, including Generally
Accepted Accounting Principles (GAAP).


     Each party acknowledges and agrees that the Software, all documentation
and other technical information delivered hereunder (“Technical Data”) are
subject to export controls imposed by the United States Export Administration
Act 1979, as amended (the “Act”) (or any future export control laws) and the
Export Administration Regulations (“EAR”) promulgated there under. MODUS MEDIA
agrees not to export, reexport, or transmit, directly or indirectly, any
Technical Data outside the United States or Canada without complying with the
Act and without the prior written consent of the Bureau of Export
Administration of the U.S. Department of Commerce, or such other governmental
entity as may have jurisdiction over such export or transmission. MODUS MEDIA
certifies that neither the Technical Data nor its direct product: (a) is
intended to be used for any purpose prohibited under the Act of EAR including,
without limitations, nuclear related activities or chemical or biological
weapons or missiles; or (b) is intended to be shipped, exported or transmitted,
either directly or indirectly to any foreign destination outside the United
States or Canada. This section shall survive any termination or expiration of
this Agreement.


     INTUIT and MODUS MEDIA represents and warrant all products provided to
MODUS MEDIA hereunder, including commodities, technology, and software, will be
imported or exported in accordance with application laws and regulations
including specifically U.S. laws and regulations.
Diversion contrary to U.S. law is prohibited. Resale or reexport to Iraq,
Sudan, Iran, Syria, Cuba, Libya or North Korea is prohibited. Transfer or
resale to nuclear, missile, chemical or biological weapons end users or end
uses is prohibited. Resale or reexport to Albania, Armenia, Azerbaijan,
Belarus, Bulgaria, Cambodia, Estonia, Georgia, Kazakhstan, Kyrgystan, Laos,
Latvia, Lithuania, Moldova, Mongolia, People’s Republic of China (excluding
Hong Kong), Romania, Russia, Tajikstan, Turkmenistan, Ukraine, Uzbekistan, or
Vietnam without approval of the U.S. Government is
prohibited. MODUS MEDIA shall subscribe to the publications
“Denied Parties; Specification Designated Nationals” and “The Entity List”, (the “Lists”) from a
qualified service such as OCR, RegData or other regulatory provider approved by
INTUIT. All Customer Orders should be screened against said List at initiation
of order. MODUS MEDIA shall retain documentation, entering the dates of the
screenings, the name of the person(s) performing the screenings, and the date
of the list used to perform the screening, in an electronic file. This log or
file MUST BE MAINTAINED FOR AUDIT PURPOSES for a period of 6 years after which
MODUS MEDIA will notify INTUIT before destroying. If a Customer appears on any
of the Lists, MODUS MEDIA shall immediately cancel all



13








 


pending orders and stop any in-transit shipments to the Customer, to the extent
legally possible, and shall promptly notify INTUIT of such Customer.


     MODUS MEDIA is responsible for obtaining the required licenses, paying
permit fees, duties and customs fee in order to perform its obligations under
this contract. INTUIT is responsible for providing MODUS MEDIA with an Export
License Requirement Matrix, outlining the commodity Name, ECCN, Schedule B and
License Requirement by Country Group for all products and technology, being
exported. MODUS MEDIA is responsible for preparing and submitting all required
documentation in connection with the invoicing of INTUIT products. If MODUS
MEDIA delivers products to any customer in accordance with INTUIT’s directions,
INTUIT agrees to indemnify MODUS MEDIA for any consequent direct or indirect
violation of the application export control laws. MODUS MEDIA will retain for a
period of 6 years. Documents and other evidence sufficient to enable INTUIT to
support governmental reviews or audits. MODUS MEDIA further agrees to assist
INTUIT, upon request, in any appropriate legal or administrative proceedings
regarding the validity of such licenses, fees and taxes.


     Section 11.3 Work Product


     Work product MODUS MEDIA has developed to provide the Services in this
Agreement is the exclusive property of MODUS MEDIA. Information contained
within the work products which is INTUIT confidential, relates to INTUIT’s
customer information, and purchases. And INTUIT inventory standard cost, is the
exclusive property of INTUIT and will be surrendered to INTUIT upon demand.


     Section 11.4 Validity


     If any of the provisions of this Agreement are declared to be invalid,
such provisions shall be severed from this Agreement and the surviving
provisions shall remain in full force and effect.


     Section 11.5 Waiver


     A waiver of any default hereunder or of any of the terms and conditions of
this Agreement shall not be deemed to be a continuing waiver or a waiver of any
other default or of any other term or conditions, but shall apply solely to the
instance to which such waiver is directed. The exercise of any right or remedy
provided in this Agreement shall be without prejudice to the right to exercise
any other right or remedy provided by law or equity.


     Section 11.6 Assignability


     This Agreement shall not be assigned by either party without the prior
written consent of the other party, which shall not be unreasonably withheld or
delayed; provided that the assignee is of the same or greater creditworthiness as the assignor. Notwithstanding the preceding
sentence, INTUIT and MODUS MEDIA may assign their rights and obligations
hereunder to any subsidiary or affiliate or in connection with a merger or
other business combination in which it is not the surviving entity, except if
the assignee is a competitor of the nonassigning party. Any such attempted
assignment in violation of this provision shall be null and void.


     Section 11.7
Governing Law

14








 


     THE VALIDITY, PERFORMANCE, CONSTRUCTION, AND INTERPRETATION OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA, EXCLUDING
CONFLICTS OF LAWS PRINCIPLES AND EXCLUDING THE UNITED NATIONS CONVENTION ON
CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS.


     Section 11.8 Disputed Resolution


     The parties will attempt in good faith to promptly resolve any controversy
or claim arising out of or relating to this Master Agreement or Statement of
Work, except for matters pertaining to Intellectual Property, through
negotiations between the parties before resorting to other remedies available
to them. Any such dispute shall be referred to appropriate senior executives of
each party who shall have the authority to resolve the matter. If the senior
executives are unable to resolve the dispute within ten (10) business days from
the date the senior executives receive notification of the disputed in writing,
the parties may by agreement refer the matter to an appropriate forum of
alternative dispute resolution ranging from mediation to arbitration. If the
parties cannot resolve them matter or if they cannot agree upon an alternative
form of dispute resolution, then either party may pursue resolution of the
matter through litigation.


     Section 11.9 Force Majeure


     Neither party shall be liable to the other party for any alleged loss or
damages resulting from delays in performance caused by acts of the other party,
acts of civil or military authority, governmental priorities, earthquake, fire,
flood, epidemic, quarantine, energy crisis, strike, labor trouble, war, riot,
accident, shortage, delay in transportation, service outage of a telephone
provider or public utility, or any other causes beyond the reasonable control
of the party whose performance is so delayed, except that INTUIT shall at all
times be responsible for the prompt payment of all if its financial obligations
to MODUS MEDIA. If MODUS MEDIA’s performance of Services is
delayed by Force Majeure, the time for performance shall be extended for the period of Force
Majeure.


     Section 11.10 Employee Solicitation Prohibited


     Each of the parties hereto recognizes that the experience, dedication, and
know-how of their employees represent an important, valuable, unquantifiable
asset and a significant training investment. Therefore, for Term of this Master
Agreement and for six (6) months after an employee is involved in any work
pursuant to or related to this Agreement, neither party may, without the prior
written permission of the other party, directly solicit for employment for
similar duties as currently performed, any employee of the other party. For the
purposes of this Section, “directly solicit” shall be defined as a party and or
search firm employed by the party and acting on the party’s behalf initiating a
discussion with an employee of the other party regarding a job at the
soliciting party, and requesting that the employee of the party submit a resume
and/or interview for the job. “Directly solicit” shall not be deemed to include
public advertising (e.g., in newspapers, trade publications, or solicitation by
independent recruiters).


     Section 11.11 Authorized Representatives


     Each party shall, at all times, designate one representative who shall be
authorized to take any and all action and/or grant any approvals required in
the course of performance of this Agreement. Such representative shall be fully
authorized to act for and bind such party including the approval of


15








 



amendments to this Agreement. Until written notice to the contrary, the
authorized representatives of the parties are as follows:



	 	 	 
	For INTUIT:	 	
For MODUS MEDIA:
	 
	Dave Kinser	 	
Ron Leitch
	Sr. Vice President	 	
President, Americas Region
	Intuit Inc.	 	
Modus Media International, Inc.
	2535 Garcia Avenue	 	
690 Canton Street
	Mountain View, CA 94043	 	
Westwood, MA 02090
	Telephone Number 650-944-6656	 	
Telephone Number 781-407-2000
	 
	Copy to Catherine Valentine, General Counsel	 	
General Counsel



     The authorized representative’s manager and manager’s manager, and any
corporate officer shall also have the power to bind the party. No other
employee, agent. Or representative has the authority to bind the party.


     Section 11.12 Notices


     Any notice regarding non-performance, breach, termination, or renewal
required or permitted to be given under this Master Agreement shall be given in
writing and shall be hand delivered or deposited, postage prepaid, registered
or certified mail, in the United States or other country’s mail, or sent by
express delivery, addressed to MODUS MEDIA, or INTUIT, as the case may be, at
the address shown below or at such other address as shall be given by either
one to the other in writing. All other notices may be sent by regular mail or
facsimile. All notices shall be deemed to have been given and received on the
earlier of actual delivery or three (3) days for the date of postmark.



	 	 	 
	For INTUIT:	 	
For MODUS MEDIA:
	 
	Dave Kinser	 	
Ron Leitch
	Sr. Vice President	 	
President, Americas Region
	Intuit Inc.	 	
Modus Media International, Inc.
	2535 Garcia Avenue	 	
690 Canton Street
	Mountain View, CA 94043	 	
Westwood, MA 02090
	 
	Copy to Catherine Valentine, General Counsel	 	
General Counsel



     Section 11.13 Time is of the essence in this Agreement.



     Modus Media and Intuit agree that with respect to any projects under this
Agreement, time is of the essence.


16








 


     Section 11.14 Costs of Litigation


     If any legal action, arbitration or other judicial proceeding is brought
based on an alleged dispute, breach, default, or misrepresentation regarding
this Agreement, the prevailing party or parties shall be entitled to recover
reasonable attorney’s fees and the other costs incurred in that action or
proceeding, including costs relating to the collection of overdue invoices.
The prevailing party or parties shall also be entitled to obtain any other
relief to which the prevailing party or parties may be entitled.


     Section 11.15 Severability


     If any provision of this Agreement is held invalid or unenforceable by any
court of final jurisdiction, (a) said provision shall be reconstrued in a
manner that will eliminate only the part of the provision that is invalid or
unenforceable and that will give effect to the intent of the parties as
discerned from the remaining provisions of the agreement, (b) the remainder of
this Agreement shall remain in full force and effect, and (c) all other
provisions of this Agreement be construed to remain fully valid, enforceable,
and binding on the parties.


     Section 11.16 Entire Agreement


     All parties acknowledge having read this Agreement and agree to be bound
by its terms. This Master Agreement and the Schedules, Exhibits and Statements
of Work attached hereto contain the complete, final and exclusive statement of
the terms of the agreement between the parties relating to the subject matter
hereof and supersedes all prior understandings, writing, proposals,
representations or communications, oral or written, relating to the subject
matter hereof. This Agreement may not be modified except in writing executed by
both parties. The terms and conditions of the Agreement shall prevail
notwithstanding any conflict with the terms and conditions of any Invoices or
other form used by MODUS MEDIA, or any purchase order of any other form used by
INTUIT.


IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the
effective date set forth in Section 1.1:


INTUIT INC.


By:   /s/ DAVID KINSER


Its:   Vice President and Chief Information Officer


MODUS MEDIA INTERNATIONAL, INC.


By:   /s/ RON LEITCH


Its:   President, Americas Region


17








 



Exhibit 1

RIGHT TO COPY OBJECT CODE AND DOCUMENTATION LICENSE


               1. License Software and Documentation. The software
(“License Software”) and related documentation (“Licensed Documentation”)
included under this Exhibit 1 are listed on Exhibit 1, attached hereto. INTUIT
will provide MODUS MEDIA with a “Golden Master” of the Licensed Software and
Licensed Documentation.



               2. License Grant. Subject to the
terms of this Exhibit 1, INTUIT
hereby grants to MODUS MEDIA and MODUS MEDIA hereby accepts a non-exclusive,
non-royalty bearing, personal, non-transferable license to reproduce verbatim
the License Software and the Licensed Documentation, which may be customized or
modified, to be distributed by MODUS MEDIA to Customers upon request by such
Customer, in accordance with MODUS MEDIA’s obligations as stated in the Master
Agreement. MODUS MEDIA agrees and acknowledges that this license does not grant
any rights or title to patents, copyrights, trade secrets, trademarks, or
rights of ownership in the Licensed Software or Licensed Documentation, in
whatever form.



               3. License Fee. No license fee are due and payable by MODUS MEDIA to
INTUIT for the license(s) granted pursuant to this Exhibit 1.



               4. Copyright Notice. INTUIT’s
copyright notice as contained in
the Golden Master(s) must be included on each copy made by MODUS MEDIA of the
License Software and Documentation, in whatever form.



               5. Term. The term of this Exhibit 1 shall be coterminous with that of the Master Agreement, unless
terminated earlier by either party by the other party as provided in the Master
Agreement. Upon termination or expiration of this Exhibit 1 MODUS MEDIA will
destroy all Golden Masters and so certify to INTUIT, and MODUS MEDIA will not
make any additional copies.


               6. Transferability. MODUS MEDIA may not transfer or assign Golden Master
to another party. MODUS MEDIA may not transfer, assign, or sublicense the
license granted hereunder to another party.



               7. Confidentiality. MODUS MEDIA hereby acknowledges that the structure
and organization of the Licensed Software are valuable trade secrets of INTUIT
and its intellectual property. MODUS MEDIA agrees to hold such trade secrets
and intellectual property in confidence. MODUS MEDIA further acknowledges that
INTUIT retains title to the Licensed Software and Licensed Documentation
recorded on the original media and all subsequent copies of the Licensed
Software regardless of the form or media. Modification, reverse engineering,
reverse compiling or disassembly of the License Software are expressly
prohibited.



18








 




RIGHT TO COPY OBJECT CODE AND DOCUMENTATION LICENSE

EXHIBIT 1A to MASTER AGREEMENT

between


INTUIT INC. and MODUS MEDIA INTERNATIONAL, INC.


EXHIBIT 1A


LICENSED SOFTWARE


MODUS MEDIA is authorized to duplicate software copies of, for the purposes of
this Agreement only.


LICENSED DOCUMENTATION


MODUS MEDIA is authorized to duplicate all collateral and media for end users
or channel partners, for the purpose of this Agreement only.


19








 



EXHIBIT 2


Intuit’s Privacy Policy for Partners


In addition to the obligations under the Agreement between Intuit and its
Partner, Intuit requires that its Partners comply with certain policies in
order to safeguard the confidentiality of Personally Identifiable Information
relating to Intuit’s customers. For this reason, Intuit has adopted the
following Privacy Policy for Partners that must be adhered to as a condition of
Partners doing business with Intuit.


The Privacy Policies for Partners are intended to apply only to Intuit’s
business conducted in the United States. All Partner agreements and amendments
that become effective on or after April 3, 2000, must incorporate this Privacy
Policy for Partners.


Definitions



	      	•	  	Partner – For the purpose of this document only, a “Partner”
is any third party that has a contractual agreement to provide
marketing, products or services to Intuit or Intuit’s customers,
and/or has access to Personally Identifiable Information. Except as
expressly stated in this Policy, this Policy shall not be
interpreted or construed to create an association, agency, joint
venture or legal partnership between Intuit and such third parties
or to impose any liability attributable to such a relationship upon
either party. Neither party shall have any right, power or authority
to enter into any agreement for or on behalf of, or incur any
obligation or liability of, or to otherwise bind the other party.




	      	•	  	Intuit Customer – Users who view Intuit-owned/controlled Web sites,
register at Intuit-owned/controlled Web sites, order or use Intuit
products, services or software trials. Pursuant to specific
Intuit-Partner agreements, a Partner may have particular rights to use
Personally Identifiable Information.




	      	•	  	Personally Identifiable Information – For the purpose of this
document, Personally Identifiable Information relates to information
about Intuit Customers that, among other things, identifies or can
be used to identify, contact, or locate the person to whom such
information relates. Personally Identifiable Information includes,
but is not limited to name, address, phone number, fax number, email
address, social security number and credit card information. To the
extent unique information (which by itself is not personally
identifiable), such as a personal profile, unique identifier, and IP
address is associated with Personally Identifiable Information, then
such unique information will also be considered Personally
Identifiable Information. Personally Identifiable Information



20








 




	      	 	  	does not include information that is collected anonymously or
demographic information not connected to an identified individual,
provided that certain types of such non-identifiable information may
still be subject to restrictions on use and disclosure by law, e.g.,
tax return information.



Partners’ General Responsibilities



	      	•	  	Partners must agree to comply with this Privacy Policy for
Partners and to clearly communicate and enforce this Policy among
their employees, agents and any third parties used to perform any of
the Partners’ obligations under their Agreement with Intuit or this
Policy.
	 
	      	•	  	Partners shall treat Personally Identifiable Information as
confidential and proprietary information of Intuit and to protect it
from disclosure to any third party (that is not an agent of the
Partner contracted to do work pertaining to the Agreement), subject
to this Policy, their Agreement with Intuit, and otherwise required
by law.
	 
	      	•	  	Partners shall limit their collection and use of Personally
Identifiable Information to the expressed business purpose(s) set
forth in the relevant Agreement(s) between the Partners and Intuit.
	 
	      	•	  	Partners shall employ appropriate security measures to
maintain the integrity and confidentiality of Personally
Identifiable Information, and take reasonable precautions to protect
it from loss, misuse or accidental or unauthorized access or
alteration.
	 
	      	•	  	Partners shall ensure that only authorized employees and
agents, who are trained in the proper handling of Personally
Identifiable Information and who are subject to obligations to
maintain the confidentiality and restricted use of such information,
have access to Personally Identifiable Information.
	 
	      	•	  	Partners must transmit Personally Identifiable Information in
a secure manner and store it in a secure environment.
	 
	      	•	  	Except where Personally Identifiable Information is
“co-owned,” or the customer provides Personally Identifiable
Information to the Partner without restriction, Partners shall not
rent, sell, or otherwise disclose Personally Identifiable
Information. In those circumstances where Partners “co-own”
Personally Identifiable Information, or the customer provided such
information to the partner without restriction, Partners may rent,
sell, or otherwise disclose Intuit Personally Identifiable
Information only if they provide a method for Intuit Customers to
“opt out” of such activity (see Opt Out Choice below).



21








 




	      	•	  	Intuit encourages its Partners to adopt privacy policies and
practices (beyond what is covered here in this Policy) at least as
protective as those used by Intuit.
	 
	      	•	  	Partners shall comply with applicable law in their use and
disclosure of all information provided to them by Intuit, whether or
not such information falls within the definition of Personally
Identifiable Information.
	 
	      	•	  	Partners who collect Personally Identifiable Information
related to Intuit customers shall identify to customers the
organization(s) collecting this Information and describe to
customers how this Information will be used.



Suppression



	      	•	  	Intuit maintains in-house suppression file(s) that include
Personally Identifiable Information relating to those individuals
who have indicated the circumstances under which they may not want
to be contacted or solicited by Intuit. Partners who work on
Intuit’s behalf, i.e. outsourcers or vendors, shall comply with
Intuit’s policies relating to the use of such suppression file(s) to
suppress names and addresses in the services they perform and the
databases they use, maintain, and/or manage on behalf of Intuit.
	 
	      	•	  	Except where Personally Identifiable Information is
“co-owned,” Partners shall not use Personally Identifiable
Information maintained in Intuit’s in-house suppression files.
	 
	      	•	  	Partners who conduct mail solicitation to prospective
customers on behalf of Intuit shall utilize the Direct Marketing
Association’s Mail Preference Service.



Telemarketing



	      	•	  	Partners who conduct telemarketing activities on Intuit’s
behalf shall comply with all applicable laws and regulations
including “Do Not Call” laws.
	 
	      	•	  	Partners who conduct telemarketing activities on Intuit’s
behalf shall comply with Intuit’s Do Not Call Policy (attached).
	 
	      	•	  	Partners who conduct telemarketing activities on behalf of
Intuit shall employ the Direct Marketing Association’s Telephone
Preference Service, as well as any applicable federal and/or
local/state-managed preference services when phoning prospective
customers.



Fax


22








 





	      	•	  	Partners who work on Intuit’s behalf to conduct fax
activities shall comply with all applicable laws and regulations
relating to fax marketing activities.
	 
	      	•	  	Partners who work on Intuit’s behalf to conduct fax
activities shall not send any unsolicited facsimile to any recipient
who does not have a prior business relationship with Intuit, unless
the recipient has given Intuit prior express permission to receive
such a facsimile.
	 
	      	•	  	Partners who work on Intuit’s behalf to conduct fax
activities to prospective Intuit customers shall include the date
and time of transmission, and the name and telephone number of
Intuit, or Partner working on Intuit’s behalf, as well as notice of
how to opt-out of future facsimile communications.



Email



	      	•	  	Partners who conduct email marketing activities on Intuit’s
behalf shall not send unsolicited email to any recipient who does
not have a preexisting relationship with Intuit or who has not
consented to receive such email. Consent from a prospective
customer is considered to be given when such a prospect opts in to
receiving communications from Intuit or opts in to a program where
the prospect chooses to receive communications from companies like
Intuit, i.e. companies engaged in financial services. Marketing
email sent on Intuit’s behalf shall contain notice of how to opt-out
of future marketing email communications.



Opt Out Choice



	      	•	  	Intuit customers may choose their contact preferences for the
manner in which Intuit will use Personally Identifiable Information.
Partners that provide products or services on Intuit’s behalf must
agree to employ procedures in a timely manner to honor these
preferences.
	 
	      	•	  	Partners that provide co-branded Web sites with Intuit, shall
give customers of the co-branded Web site the opportunity to choose
their preferences for the manner in which the co-branding Partner
will use Personally Identifiable Information for marketing and list
rental purposes.
	 
	      	•	  	Partners, to whom Intuit refers Intuit Customers, or provides
Personally Identifiable Information, shall give customers the
opportunity to choose their preferences for the manner in which the
Partner will use Personally Identifiable Information for marketing
and list rental purposes.



Reviews



	      	•	  	Partners that provide products or services on Intuit’s
behalf, i.e. outsourcers or vendors, shall reasonably cooperate with
Intuit so as to allow Intuit to verify their compliance with
Intuit’s Privacy Policies for Partners and shall allow Intuit to
audit their records and practices to determine compliance with such
Policy.



23








 




	      	•	  	All Partners must be able to demonstrate compliance with
these policies.



Ad Servers


Intuit hires companies that serve ads on Intuit’s Web sites; these companies
are known as ‘ad servers’.



	      	•	  	Intuit shall not disclose Personally Identifiable
Information, which Intuit collects, to ad servers.
	 
	      	•	  	Ad servers shall offer an opt-out mechanism to customers,
that when used, will prohibit ad servers from associating Personally
Identifiable Information with customers’ anonymous customer profile.
	 
	      	•	  	Intuit shall have the option of disclosing the ad server by
name in its privacy statement(s) along with links to the ad server’s
privacy statement and opt-out mechanism(s).



When an Intuit Customer Becomes a Partner’s Customer



	      	•	  	Intuit’s Web sites may include services or information
provided by Partners, for example, insurance companies. Intuit is
not responsible for any information provided to or transactions
entered into by customers with such Partners. In the event Intuit’s
Web site customers provide information or engage in transactions
with such Partner, the terms governing the collection and use of any
Personally Identifiable Information provided in connection therewith
shall be governed by the terms of such Partner’s privacy policies
and/or practices, and Intuit shall have no liability therefor.
	 
	      	•	  	Pursuant to an Intuit-Partner agreement, Intuit and the
Partner may independently control Personally Identifiable
Information. In such cases, the Partner’s privacy policies apply to
the Partner’s practices.



Marketing to Children


Intuit’s Web sites are not intended for children (ages 13 and under) nor does
Intuit knowingly collect personal data from children. Partners may not market
Intuit’s site to their customers who may be children, nor link Intuit sites to
those intended for children.


Compliance with U.S. Laws and Regulations


Partners shall comply with all applicable federal, state, and local laws and
regulations.


24








 


Policy Changes


Intuit may, in its sole discretion, amend this policy from time to time, as
required by law or otherwise.


25








 



EXHIBIT 3


Privacy Technology Guidelines



	       	1.	  	Disclosure. Post a prominent privacy policy (linked from
your home page) to tell consumers what you collect, how and why,
and what their rights are.
	 
	       	2.	  	Access. Customers must be able to “login” to a website to
see information collected about them. They should be able at any
time to change or delete information collected, with the
exception that certain transactional information (e.g., a
purchase record) is owned by the merchant.
	 
	       	3.	  	SSL. Always use https/ssl (vs email or clear http etc)
for transmission of any information which is considered private
(financial information like credit card numbers, personally
identifiable information like email or street address or phone
number, etc), to prevent http snooping. (Data centers should
tcp-snoop all traffic to grep for passwords.)
	 
	       	4.	  	Encryption. Always oneway encrypt all passwords—never
store any unencrypted or two-way hashed passwords on disk. This
means that customer support must never be able to get someone’s
password, but must instead only be allowed to reset it, else
(better) let the user reset it themselves, with coded-URL email
confirmation.
	 
	       	5.	  	URL Parameters. Do not pass user identifiable information
as URL parameters, as this causes them to be logged in the http
logfiles. (And also sends this information in the clear if you
forget to use SSL.) Instead, use hidden form fields or cookies
or encrypted session IDs.
	 
	       	6.	  	Email Login. Use email address to uniquely indentify
users vs. making them create yet another unambiguous login id
which they will forget and write down (and thus open a
security/privacy hole).
	 
	       	7.	  	Password Email. Never ever send any passwords (even
temporary ones) by email, as they can easily be tcp snooped.
	 
	       	8.	  	Precedence: Bulk. All bulk email should have Precedence:
Bulk in the header, to allow systems and users to correctly
prioritize bulk invasions.
	 
	       	9.	  	Actual “To” Address. All bulk email should have the
actual recipient address on the To line (this means one email
per recipient!) to allow recipient to know which of their many
email addresses were used.
	 
	       	10.	  	Actual “From” Address. Make sure all of your email is
sent with an accurate From address, so consumers can simply hit
the Reply key in their mail client to reply to a human. The From
address should also include a descriptive “full name”.



26








 




	       	11.	  	List Exposure. Do not ever list all recipient email
addresses in the mail headers, else this will expose recipients
to other recipients. (Also, the BCC field should not be used for
this.)
	 
	       	12.	  	One Click Removal. All bulk email messages should include
a personalized/coded removal URL to allow single click removal.
The coded URL should not contain the email address itself. Do not use
systems which require the user to reply-to the bulk
email with some special address or Subject convention, as these
do not work for people whose known email was forwarded to
another of their email addresses.
	 
	       	13.	  	Opt-in for mailing lists (promotions, newsletters, etc),
with a separate opt-in for the “selected partners” lists. (Need
guidelines as to when to use opt-in vs opt-out...)
	 
	       	14.	  	Victim Signup. In cases where there is an email signup
that might be abused (bad guys signing up victims to random high
volume newsletters), consider sending coded-URL opt-in email to
confirm the opt-in email address.
	 
	       	15.	  	RFC822. Allow fully RFC822 compliant email addresses, including
ones like paul+amazon@example.com (the +amazon part is used by
many privacy advocates to track down where/how their email
addresses are used).
	 
	       	16.	  	Law Enforcement. Provide customer information to legal
authorities as required, but take steps to verify their identity
and authority, only sending them the minimal set of information
which will satisfy their requests.
	 
	       	17.	  	htaccess should never be used as the secure web site
login mechanism for mass market / consumer applications, as it
is a lousy user interface.
	 
	       	18.	  	Forced Changes. Do not force consumers (vs. internal
corporate/enterprise users) to regularly change their passwords,
as this will cause them to forgot them, and to write them down
somewhere (and thus open a security/privacy hole).
	 
	       	19.	  	Digital Certificates. Do not use digital certificates
for mass market consumer applications, as they are way too hard
to use for this. (They are appropriate for server-to-server
authentication, or for corporate/enterprise applications.)




27








 



FIRST AMENDMENT TO MASTER AGREEMENT

Between INTUIT INC. and MODUS MEDIA INTERNATIONAL, INC.


THIS FIRST AMENDMENT TO MASTER AGREEMENT (“First Amendment”) shall be effective
as of August 27, 2001 (herein the “Effective Date”) and it is between INTUIT
Inc. (herein “INTUIT”), a Delaware corporation located at 2535 Garcia Avenue,
Mountain View, CA 94043, and MODUS MEDIA INTERNATIONAL, INC., incorporated in
Delaware (herein “MODUS MEDIA” or “MMI”), located at 690 Canton Street,
Westwood, MA 02090, and shall run coterminous with the Master Agreement between
the parties of the same effective date (“Master Agreement”).


Whereas, the parties desire to facilitate Intuit’s purchase of goods and
services provided by MMI;


Therefore, the parties agree to amend the Master Agreement by adding the
following text:


[ * ]


13. The parties agree that the terms and conditions set forth in this First
Amendment do not impact the current pricing negotiated by the parties. In the
event that any additional charges are incurred, the parties shall negotiate in
good faith to revise the pricing schedule accordingly.


IN WITNESS WHEREOF, the parties hereto have signed this First Amendment as of
August 27, 2001.


INTUIT INC.


By:   /s/ KEN R. MUDGE


Its:   VP, Procurement


MODUS MEDIA INTERNATIONAL, INC.


By:   /s/ FRED LASKEY


Its:   VP & GM, Americas Operation


*     We have requested confidential treatment for certain portions of this
document pursuant to an application for confidential treatment sent to the
Securities and Exchange Commission (SEC). We omitted such portions from this
filing and filed them separately with the SEC.