Document:

Exhibit 10.1

 

 

24/7 REAL
MEDIA INC.

and

LYCOS,
INC.

 

AMENDMENT
NO. 1

TO

SERVICES
AGREEMENT

AND
TECHNOLOGY SERVICES AGREEMENT

 

This Amendment No. 1 (the
“Amendment”) to the 24/7 REAL MEDIA INC. and LYCOS, INC. Services Agreement,
(the “Services Agreement”) and the 24/7 REAL MEDIA INC. and LYCOS, INC. Technology Services Agreement,
(the “Technology Agreement”)  is made as of December   7, 2004 
(the “Amendment Effective Date”) by
and between Lycos, Inc., a Virginia corporation (“Lycos”),
with an address at 100 Fifth Avenue, Waltham, MA  02451, and 24/7 Real Media, Inc., a Delaware
corporation (“24/7”), with an address
at 1250 Broadway, New York, NY  10001;
all capitalized Terms not defined when first used shall be construed in
accordance with the Definitions set forth in Section 1 of the Services
Agreement.  Unless expressly stated
otherwise, references to the Services Agreement shall include all Exhibits and
Schedules hereto.

 

WHEREAS, the Parties
entered into the Services Agreement as of February 11, 2004;

 

WHEREAS, the Parties
entered into the Technology Agreement as of February 11, 2004;

 

WHEREAS, in consideration
of the mutual covenants and agreements contained herein and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is agreed as follows:

 

SERVICES
AGREEMENT

 

The
definition of “Advertising” and “Advertisement” is hereby amended and restated
in its entirety as follows:  “Advertising” or “Advertisements” means the standard pixel advertisement sold for
display on the Web Sites and any other material displayed on the Web Sites that
promotes a brand or a product or a service through banners, buttons, jump pages
and any other format, including, without limitation, IAB recognized formats.

 

The definition of “Impression”
is hereby amended and restated in its entirety as follows: “Impression” means requests from a user
of a Web Site to 24/7 for Advertising, as determined in accordance with the IAB
standards.”

 

The definition of “Net
Advertising Sales Revenue” is hereby amended by deleting the term “gross
bookings” in each instance in such definition and inserting the term “gross
revenue” in their places.

 

Section 2A of the
Services Agreement is hereby amended and restated in its entirety as follows:

 

“A.  Grant of Rights.  Lycos hereby grants to 24/7 the exclusive
right to sell Advertising to be displayed on the Web Sites during the Term to
Web Site users originating anywhere in the world, provided, however,
that (i) effective July 1, 2005, Wired News shall not be a Web Site (for
purposes of clarity, Wired News means

 

1

 

wired.com and subdomains
thereof) and (ii) effective January 1, 2006, Quote.com (and subdomains thereof)
shall not be a Web Site. For purposes of clarity, this means that, effective
July 1, 2005 for Wired.com and effective January 1, 2006 for Quote.com, Lycos’
shall have the exclusive right to have its own internal sales force assume sole
responsibility for the sale of Advertising on Wired.com and Quote.com, and for
the billing and collection for all Advertising run on Wired.com and
Quote.com.   Nothing contained herein
shall affect the exclusive right of 24/7 to sell all Advertising on Wired.com
prior to July 1, 2005, for campaigns scheduled to run both prior to and after
July 1, 2005. Nothing contained herein shall affect the exclusive right of 24/7
to sell all Advertising on Quote.com prior to January 1, 2006, for campaigns
scheduled to run both prior to and after January 1, 2006.

 

(i)  Transition Accounts.  On or prior to July 1, 2005, 24/7 shall
identify twenty Advertising accounts to which 24/7 has sold Advertising on
Wired.com (the “24/7 Accounts”),
in respect of which Lycos will pay 24/7 an amount equal to 35% of the Net
Advertising Sales Revenue (“Transition Commission 1”)
generated from the 24/7 Accounts on Wired.com for each of the months
individually of July 2005 and August 2005, and an amount equal to 17.5% of the
Net Advertising Sales Revenue (“Transition Commission 2”)
generated from those 24/7 Accounts on Wired.com for each of the months
individually of September, 2005 and October, 2005.  Payments associated with each of the months
within Transition Commission 1 will be paid by Lycos to 24/7 no later than
October 15, 2005.  Payments associated
with each of the months within Transition Commission 2 will be paid by Lycos to
24/7 no later than December 15, 2005.  
Each of Lycos’ Transition Commission 1 payment obligations to 24/7 shall
not exceed one-sixth (1/6) of the gross revenues generated from the 24/7
Accounts during the period January 1, 2005 to June 30, 2005 multiplied by 35%.
Each of Lycos’ Transition Commission 2 payment obligations to 24/7 shall not
exceed one-sixth (1/6) of the gross revenues generated from the 24/7 Accounts
during the period January 1, 2005 to June 30, 2005 multiplied by 17.5%.  On or prior to January 1, 2006, 24/7 shall
identify twenty Advertising accounts to which 24/7 has sold Advertising on
Quote.com (the “24/7 Quote Accounts”),
in respect of which Lycos will pay 24/7 an amount equal to 35% of the Net
Advertising Sales Revenue (“Transition Quote
Commission 1”) generated from the 24/7 Quote Accounts on
Quote.com for each of the months individually of January 2006 and February
2006, and an amount equal to 17.5% of the Net Advertising Sales Revenue (“Transition Quote Commission 2”)
generated from those 24/7 Quote Accounts on Quote.com for each of the months
individually of March 2006 and April 2006. 
Payments associated with each of the months within Transition Quote
Commission 1 will be paid by Lycos to 24/7 no later than April 15, 2006.  Payments associated with each of the months
within Transition Quote Commission 2 will be paid by Lycos to 24/7 no later
than June 15, 2006.   Each of Lycos’
Transition Quote Commission 1 payment obligations to 24/7 shall not exceed
one-sixth (1/6) of the gross revenues generated from the 24/7 Quote Accounts
during the period July 1, 2005 to December 31, 2005 multiplied by 35%. Each of
Lycos’ Transition Quote Commission 2 payment obligations to 24/7 shall not
exceed one-sixth (1/6) of the gross revenues generated from the 24/7 Accounts
during the period July 1, 2005 to December 31, 2005 multiplied by 17.5%.   24/7 shall have the right to audit all such
payments, pursuant to Section 19 of the Services Agreement. Other than
Transition Commission 1 and Transition Commission 2, 24/7 shall not be entitled
to any commissions with respect to Advertising on Wired.com past July 1, 2005,
and other than Transition Quote Commission 1 and Transition Quote Commission 2,
24/7 shall not be entitled to any commissions with respect to Advertising on
Quote.com past January 1, 2006.

 

(ii)  Content Targeted
Advertising.  Lycos shall have
the right for the duration of the Term to place Content Targeted Advertising on
the Web Sites subject to the following parameters: one Content Targeted
Advertisement per page consisting of up to four advertisers, such
Advertisements to be located at the bottom of the Web pages within the Web
Sites with the exception of up to 70% of the pages within the Tripod and
Angelfire member pages, where such advertisements may at Lycos’ discretion be
located at the top of such pages for the duration of the Term; and (ii) Lycos
shall have the right to retain up to ten percent (10%) of the

 

2

 

Impressions in any calendar month, subject to a cap of 10% of the
Impressions in any calendar year, to run promotional or “house” Advertisements,
or Advertisements for Strategic Partners (the “Hold Back”).

 

(iv)  Strategic Partners.  In addition, nothing in this Agreement shall
prevent or limit Lycos’ entry into Strategic Partnerships after the Effective
Date, provided, however, that to the extent that Lycos enters
into transactions with Strategic Partners after the Effective Date which
include the sale of Impressions beyond the Hold Back, such Impressions will be
deemed to have been sold by 24/7 for purposes of this Agreement, and, with
respect to such Hold Back Advertising, Lycos shall pay to 24/7 an amount equal
to 100% of the Net Advertising Sales Revenue minus the applicable Lycos
Royalty within 45 days following the last day of each calendar quarter during
the Term, and such Impressions shall not count as Projected Impressions or
Actual Impressions, and provided, further, however that
Lycos shall consult with 24/7 before entering into such a transaction
concerning the sale of such Impressions beyond the Hold Back.

 

The parties hereby agree
that the provisions of Section 5C shall be applicable to Wired News at July 1,
2005 and to Quote at January 1, 2006.”

 

The parties hereby agree
that Sections 2B(b) and 2B(d) of the Services Agreement apply only to Web
Sites.

 

All provisions in the
Services Agreement relating to the “Impression Guarantee” and “Annual Minimum
Payment” are hereby deleted.

 

Section 2D(i) of the
Services Agreement is hereby amended by deleting the phrase “provided, however,
that Lycos agrees that it will not materially alter the maintenance or
development of the Web Sites so as to negatively impact the aggregate value of
the Advertising.”

 

Section 4A, Transition
Payment. - 24/7 confirms it shall pay to Lycos $1.125 million on December 31,
2004, fulfilling all remaining obligations associated with the Transition
Payment.

 

Section 4B, Annual
Payments, is hereby amended by deleting it in its entirety and substituting the
following language:

 

(i) for the calendar year
2004, 24/7 shall pay Lycos the sum of $6,200,000; Lycos acknowledges that it
has received from 24/7 to date $2,879,912, and thus the entire remaining sum
owed by 24/7 to Lycos for calendar year 2004 is $3,320,088 (such amount, the “2004
Amount Due”);

 

(ii) for the period
January 1, 2005 through March 31, 2005, 24/7 shall pay to Lycos  65% of Net Advertising Sales Revenue generated
during the period;

 

(iii) for the period
April 1, 2005 through June 30, 2005, 24/7 shall pay to Lycos  65% of the greater of (i) Net Advertising
Sales Revenue generated during the period or (ii) the Minimum CPM Revenue for
such period (as defined on Schedule C hereto);

 

(iv) for the period July
1, 2005 through December 31, 2005, 24/7 shall pay to Lycos  62.5% of the greater of (i) Net Advertising
Sales Revenue generated during the period or (ii) the Minimum CPM Revenue for
such period (as defined on Schedule C hereto); and

 

(v) for the period
January 1, 2006 through the termination of the Services Agreement, 24/7 shall
pay to Lycos 62.5% of Net Advertising Sales Revenue generated during the
period.

 

3

 

Amounts required to be
paid pursuant to the terms of Section 4B are called “Royalties”;
the applicable Royalty during any calendar quarter is the “Quarterly
Royalty”.

 

Section 4C is hereby
amended by deleting it in its entirety and substituting the following language:

 

Payment Schedule:  Quarterly Royalties shall be paid within 45
days after the last day of each calendar quarter during the Term commencing
with the first quarter of 2005, except that $2,820,088 of the 2004 Amount Due
shall be paid on the Amendment Effective Date, and $500,000 of the 2004 Amount
Due shall be paid by February 15, 2005.

 

Section 4D is hereby
amended by deleting it in its entirety and substituting the following language:

 

Advance Payment on
Royalties and Recoupment.  24/7 shall
prepay to Lycos: (i) Royalties in the amount of $1,000,000 on or prior to
December 17, 2004 and (ii) Royalties in the amount of $1,000,000 on February
15, 2005 (together, the “Upfront Advance”).  Commencing with Royalties to be paid pursuant
to Section 4B from January 2005, each quarter 24/7 shall retain 25% of
Royalties otherwise to be paid to Lycos until the date (the “Recoupment Date”) on which the
Upfront Advance has been recouped from such retained Royalties, provided,
however that, at any time prior to the Recoupment Date, Lycos may pay
24/7 in cash all or part of the unrecouped amount of the Upfront Advance and
upon such payment the amount so paid by Lycos shall be deemed earned.   If the Services Agreement is terminated
before the Recoupment Date by 24/7 pursuant to Section 5B or by Lycos pursuant
to Section 5B (other than pursuant to Section 5B(iii)) then Lycos shall pay the
unearned amount of the Upfront Advance to 24/7 in a lump sum payable within 30
days of the effective termination date. 
If the Services Agreement is terminated before the Recoupment Date by
Lycos pursuant to Section 5B(iii), Lycos shall pay the unearned amount of the
Upfront Advance to 24/7 in a lump sum payable within 30 days of the effective
termination date, together with the early termination fee specified in Section
5B(iii).

 

For example, if Net
Advertising Sales Revenue is exactly $3,000,000 for each quarter of the
Services Agreement, then, assuming a 65% Royalty rate, 24/7 shall pay Lycos
$1,462,500 per quarter ($1,950,000 Royalty less $487,500  retained Royalties) until the total of Up
Front Advance of $2,000,000 is recouped from retained Royalties.

 

Section 4E is hereby
amended by adding the phrase at the end: “or December 31, 2006, if Lycos
terminates this Agreement pursuant to Section 5B(v).”

 

Section 5, Term and
Termination, is hereby amended by the addition of a Section 5B(v), which
provides as follows:  “Lycos may
terminate this Services Agreement for convenience by giving 180 days’ written
notice to 24/7 at any time after June 30, 2006, with such notice to take effect
not earlier than January 1, 2007; provided, however, that the
Parties acknowledge and agree that termination of the Services Agreement
pursuant to this Section 5B(v) shall not give either party the right to terminate
the Technology Services Agreement pursuant to Section 5(a)(iv) of the
Technology Services Agreement.”

 

Section 5B(iii) is hereby
amended and restated in its entirety to read as follows: “Lycos may terminate
this Agreement on 90 days’ written notice upon a Change of Control of Lycos;
provided, however, that in the event of termination pursuant to this Section
5B(iii), Lycos shall pay 24/7 an early termination fee equal to $2,200,000 for
each year remaining in the Term through December 31, 2006, prorated for partial
years.”

 

Section 5C is hereby
amended by adding a (vi) as follows: “(vi) 24/7 will use commercially
reasonable efforts to provide Lycos with information relating to all
Advertising contracts entered into between 24/7 and Advertisers prior to the
effective date of termination (in particular, but without limitation, 24/7
shall provide

 

4

 

to Lycos a list of all
records (insertion orders, invoices, payment history, etc.) from July 1, 2004
forward relating to Advertisers on the Web Sites, access to information
relating to Advertising campaigns, including without limitation, customer
service reports and information relating to the delivery of such campaigns).”

 

Schedule C is hereby
amended by deleting it in its entirety and substituting the language attached
hereto as Schedule C.

 

TECHNOLOGY AGREEMENT

 

Section 5(a)(iv) of the
Technology Agreement is hereby amended by adding the following text at the end
of the current provision:  “provided,
however, that the Parties acknowledge and agree that termination of the
Services Agreement by Lycos for convenience, pursuant to Section B(v) of the
Services Agreement, shall not give either party the right to terminate the
Technology Agreement pursuant to this Section 5(a)(iv).”

 

Lycos acknowledges that
its obligations to make payments under the Technology Agreement for services
provided through the date hereof are not affected by this Amendment, and Lycos
shall pay 24/7, in accordance with the terms and provisions of the Technology
Agreement,  the sum of $422,580
(including a prorated minimum payment for December) for services delivered
pursuant to the Technology Agreement through the date hereof.

 

RELEASE

 

Each of the parties
acknowledges and agrees that this Amendment addresses and resolves all disputes
arising on or before the date hereof with respect to each parties’ performance
or non-performance under the Services Agreement, the Technology Agreement, and
the Transition Services Agreement (collectively, the Agreements), and, except
as specifically provided herein, each party hereby releases the other party and
its representatives, attorneys, agents, partners, officers, shareholders,
directors, employees, subsidiaries, affiliates, divisions, successors and
assigns, from all actions, claims, or causes of action of any kind, in law or
in equity, all suits, debts, liens, contracts, agreements, promises,
liabilities, demands, losses, damages, costs or expenses, including without
limitation court costs and attorneys’ fees, which it may have against the other
(known or unknown) on the date hereof that arise out of or relate directly to
the Agreements.  This release extends to
claims which the parties do not know or suspect to exist in their favor which
arise out of or relate directly to any events that have occurred prior to the
Amendment Effective Date.

 

All terms and conditions
set forth in the Agreements not modified by this Amendment No. 1 shall remain
in full force and effect.

 

[Signature page follows.]

 

5

 

IN WITNESS WHEREOF,
the parties hereto have duly executed this Agreement as of the date first
indicated above.

 

 

	
   

  	
  24/7 REAL MEDIA, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  David J. Moore

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LYCOS, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

6

 

SCHEDULE
C

 

MINIMUM
CPM REVENUE PROVISIONS

 

“Actual
Impression Level” means the number of actual Impressions in each
editorial category and unit type (i.e., pop under or not) set forth in the
Minimum CPM table.

 

Minimum CPM's Table

 

	
   

  	
   

  	
  CPM (ex Popunders)

  	
   

  	
  Popunder CPMs

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Category

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Business &
  Finance

  	
   

  	
  $

  	
  0.49

  	
   

  	
  $

  	
  2.08

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  eCommerce

  	
   

  	
  $

  	
  2.45

  	
   

  	
  $

  	
  1.42

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Email

  	
   

  	
  $

  	
  0.48

  	
   

  	
  $

  	
  1.85

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Entertainment
  & Culture

  	
   

  	
  $

  	
  0.29

  	
   

  	
  $

  	
  1.55

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Games

  	
   

  	
  $

  	
  0.41

  	
   

  	
  $

  	
  1.93

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Home

  	
   

  	
  $

  	
  0.54

  	
   

  	
  $

  	
  0.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  News &
  General Info

  	
   

  	
  $

  	
  4.43

  	
   

  	
  $

  	
  1.82

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Travel

  	
   

  	
  $

  	
  0.07

  	
   

  	
  $

  	
  0.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Web Publishing

  	
   

  	
  $

  	
  0.36

  	
   

  	
  $

  	
  1.51

  	
   

  

 

“Projected
Impression Level” means the number of Impressions that Lycos
projects it will make available to 24/7 in each editorial category and unit
type (i.e. pop-under or not) set forth in the Minimum CPM table. The Projected
Impression Level for the second and third calendar quarters of 2005 is due to
24/7 by January 31, 2005, and the Projected Impression Level for the fourth
calendar quarter of 2005 is due to 24/7 by July 31, 2005.

 

“Minimum
CPM Revenue” means, for each calendar quarter, the product of
the Projected Impression Level multiplied by the Minimum CPMs in each category
and unit type. The Minimum CPM Revenue is subject to adjustment in accordance
with either paragraph 1 or 2 below and, then subject to further adjustment in
accordance with paragraph 3 below.

 

1.             If the Actual Impression Level exceeds the Projected
Impression Level then the Minimum CPM Revenue shall be the product of (a) the
Projected Impression Level multiplied by (b) the Minimum CPMs in each category
and unit type multiplied by (c) the ratio of (i) the Actual Impression
Level divided by (ii) the Projected Impression Level, provided, however
that if such ratio exceeds 1.1 then such ratio shall de deemed to equal 1.1 for
purposes of the foregoing calculation.

 

7

 

2.             If the Projected Impression Level exceeds the Actual
Impression Level by more than 10% then the Minimum CPM Revenue shall be the
product of (a) Actual Impression Level multiplied by (b) the Minimum
CPMs in each category and unit type multiplied by (c) ((the Actual Impression
Level divided by (the Projected Impression Level multiplied by .90) +1) divided
by 2).

 

3.             In addition to adjustments, if any,
made pursuant to paragraphs 1 and 2 above, if the actual ratio of non-US
Advertising Impressions to actual Advertising Impressions (“Actual Ratio”), for any calendar
quarter, is greater than or less than 45% by more than 10% then: (i) the
Minimum CPM Revenue shall be reduced by (Actual Ratio minus 49.5%) if
the Actual Ratio is greater than 49.5%, and (ii) Minimum CPM Revenue shall be
increased by (40.5% minus Actual Ratio) if the Actual Ratio is less than
40.5%.

 

8Exhibit 10.1

 

	
   

  	
  DATED

  	
  December 9, 2004

  	
   

  

 

 

ALISTAIR DAVID BENNETT (1)

- and -

SEEBEYOND (UK) LIMITED (2)

 

COMPROMISE AGREEMENT

WITHOUT PREJUDICE

SUBJECT TO
CONTRACT

 

 

 

1

THIS AGREEMENT is made on                                                                                                                                                                                                                                                                                                                                                                                                                              2004

BETWEEN:

(1)                                  ALASTAIR DAVID BENNETT of Hedderley House, Jarn Way.
Old Boars Hill, Oxford, OX1 5JQ (the “Employee”); and

(2)                                  SEEBEYOND
(UK) LIMITED (Company
Number  03083353)
whose registered office is at Atrium Court, The Ring, Bracknell, Berkshire,
RG12 1BW (the “Company”);

who together shall be called the “Parties”.

RECITALS

(A)                                                           The
Employee’s employment with the Company commenced on 12 March 2000.

(B)                                                             The
Employee’s employment with the Company will end on 31 January 2005 (“the Departure Date”).

 

IT IS AGREED as follows:

1.          DEFINITIONS

1.1                                 In
this Agreement, unless the context requires otherwise, the following
expressions have the following meanings: 

 

	
  “Agreement”

  	
  the provisions of this agreement including any
  Schedule attached to this agreement;

  
	
   

  	
   

  
	
  “Claim”

   

  	
  includes
  without limitation any common law or contractual claim or any statutory claim
  arising under the Employment Legislation or European law brought against the
  Company or against any Group Company (or any of its or their respective
  officers or employees) arising out of the Employee’s employment or its
  termination or otherwise (whether or not such claim is within the
  contemplation of the Parties at the date of this Agreement) but excludes any
  Excluded Claim;

   

  
	
   

  	
   

  
	
  “Contract of Employment”

  	
  the
  contract of employment between the Employee and Software Technologies
  Corporation (UK) Limited dated 19 June 2000, a copy of which is attached at Exhibit 1;

  
	
   

  	
   

  
	
  “Employment Legislation”

  	
  the Equal Pay Act 1970, the Sex Discrimination Act
  1975, the Race Relations Act 1976, the Trade Union and Labour Relations
  (Consolidation) Act 1992, the Disability Discrimination Act 1995, the
  Employment Rights Act 1996, the National Minimum Wage Act 1998, the Working
  Time Regulations 1998, the Public Interest Disclosure Act 1998, the Human
  Rights Act 1998 and the Employment Relations Act 1999, the Trans-national
  Information and Consultation of Employees Regulations 1999, the Part-time
  Workers (Prevention of Less Favourable Treatment) Regulations 2000, the
  Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations
  2002, the Employment Equality 

  

 

2

 

	
   

  	
  (Sexual Orientation)
  Regulations 2003, the Employment Equality (Religion or Belief) Regulations
  2003;

  
	
   

  	
   

  
	
  “Excluded claim”

  	
  any claim to enforce the
  terms of this Agreement or any claim for personal injury (other than injury
  to feelings under Section 66 of the Sex Discrimination Act 1975, Section 57
  of the Race Relations Act 1976, Section 8 of the Disability Discrimination
  Act 1995, Regulation 31 of the Employment Equality (Sexual Orientation)
  Regulations 2003 or Regulation 31 of Employment Equality (Religion or Belief)
  Regulations 2003 or any other personal injury claim in respect of which an
  employment tribunal has jurisdiction to make an award) and any claim which
  could render clause 4.2 of this
  Agreement void or unenforceable (whether in whole or part); 

  
	
   

  	
   

  
	
  “Group Company”

   

  	
  any holding company for
  the time being of the Company or any subsidiary for the time being of the
  Company or a subsidiary of a holding company of the Company (for which
  purpose “holding company” and “group company” shall have the same meaning
  ascribed to them by section 736 of the Companies Act 1985 (as amended)) or
  any associated company of the Company within the meaning given in section 435
  of the Insolvency Act 1986;

   

  
	
   

  	
   

  
	
  “Compensation Plan”

  	
  the incentive compensation
  plan set out in Schedule 2 attached;

  
	
   

  	
   

  
	
  “Particular Claims”

   

  	
  all claims listed in clause 4.1 of this Agreement;

   

  
	
   

  	
   

  
	
  “Stock Option
  Plans”

  	
  the Software Technologies
  1997 Standard Incentive Stock Option Agreement and the SeeBeyond Technology
  Corporation (formerly known as Software Technologies Corporation) 1998 Stock
  Plan; and

  
	
   

  	
   

  
	
  “Termination Payments”

  	
  the payments described in clause 3.1 and clause 3.2 of this Agreement.

  

2.                                       ACCRUED SUMS

2.1                                 The
Employee will receive his normal salary and car allowance up to the 31st
December 2004, including a payment for accrued but untaken holiday.  By agreement, the Employee will remain employed
by the Company as part-time consultant until the Departure Date. During the
period commencing 1 January 2005 to the Departure Date, the Employee will be
paid a salary of £2,000 (which will subject to the usual deductions for income
tax and national insurance contributions) and will be eligible for all benefits
other than  pension contributions, car
allowance and any bonus or commission payment (save as set out below in clause3.2.)

3.                                       TERMINATION PAYMENTS

3.1                                 Without
any admission of liability, the Company shall make an ex-gratia payment as
compensation for loss of employment of £27,500 (twenty seven thousand five
hundred)  within 14 days of the Departure
Date provided that the Company has received a copy of this Agreement duly
signed and dated by the Employee and by the Employee’s solicitor and that the
Employee has complied with the terms of this Agreement.

3.2                                 Subject
to the Employee achieving his agreed targets for the fourth quarter of 2004
contained in the Compensation Plan, the Employee will be entitled to receive a
commission payment (the “Commission Payment”)
in accordance with the Compensation Plan as set out in Schedule 2. The Employee will be entitled
to receive reasonable disclosure concerning the achievement of his agreed
targets to enable him to verify the value of the

 

3

                Commission Payment if any.  Payment (if any) of the Commission Payment
will be paid to the Employee no later than 31 January 2005.  For the avoidance of doubt if there is any
conflict between the wording of this clause
3.2 and the Compensation Plan,
the wording of the Compensation Plan shall prevail.

3.3                                 For
the avoidance of doubt, the Employee will not be eligible to receive any bonus
or commission payment in relation to any work carried out during the period
beginning 1 January 2005 to Departure Date.

3.4                                 The
payment set out in clause 3.1
above will be made without deduction of income tax or national insurance
contributions pursuant to sections 401(1)(a) and 403 of the Income Tax
(Earnings and Pensions) Act 2003. Any commission payment made to the Employee
in accordance clause 3.2 above
will be subject to the usual deductions for income tax and national insurance
contributions.

3.5                                 The
Employee undertakes to be responsible for any taxation which may be payable (in
the United Kingdom or elsewhere) in relation to the Termination Payments and to
defend and indemnify the Company and keep it indemnified on a continuing basis
against all and any liabilities to taxation (including fines, interest, costs
and expenses) which the Company may incur in respect of the Termination
Payments provided always that before meeting any such liability the Company
shall first afford to the Employee a reasonable opportunity to challenge (at
his sole expense) any assessment made by the Inland Revenue and shall use its
reasonable endeavours to provide such assistance as may reasonably be required
by the Employee in challenging any assessment.

4.                                       SETTLEMENT OF CLAIMS

4.1                                 The
Employee alleges (but the Company denies) that he may have the following
statutory claims against the Company arising from his employment or its
termination:

4.1.1                                           unfair
dismissal;

4.2                                 The
Termination Payments are paid and accepted in full and final settlement of:

4.2.1                                           the
Particular Claims; and

4.2.2                                           any
Claim the Employee may have.

4.3                                 It
is a condition of payment of the Termination Payments that no proceedings in
any Employment Tribunal, High Court, County Court or otherwise have been or
will be commenced by the Employee against the Company or any Group Company or
any of their respective officers or employees (save in relation to any Excluded
Claims), and should any such proceedings be commenced, without prejudice to any
other rights or remedies which the Company may have arising from such action,
the Termination Payments paid by the Company to the Employee shall immediately
become repayable by the Employee to the Company as a debt without any set off
or reductions.

5.                                       EMPLOYEE’S WARRANTIES

5.1                                 The
Employee warrants that he has instructed his solicitor who has signed this
Agreement on whether he has or may have any Claim against the Company or any
Group Company (or any of their respective officers or employees) arising out of
his employment with or the termination of his employment with the Company and
has provided his solicitor with all relevant information to enable his
solicitor to advise on whether he has or may have any such Claim.

5.2                                 The
Employee further warrants that, having received his solicitor’s advice, he has
no claims other than the Particular Claims and that he is not aware of any
facts or circumstances which may give rise to any other claims (including any
personal injury claims) against the Company or any Group Company or any of
their respective officers or employees.

 

4

 

6.                                       CONFIDENTIALITY

6.1                                 The Employee undertakes:

6.1.1                                           to keep the terms of this Agreement confidential and not
to disclose such terms to any third parties other than to the Employee’s
professional advisers, his immediate family, the Inland Revenue, and as may be
required by law provided always that disclosure to his professional advisers
and immediate family shall be on terms that they agree to keep the same
confidential;

6.1.2                                           not
to make, or cause to be made, (whether directly or indirectly) any statement or
comment to the press or other media relating to his employment with the Company
or its termination without the prior written consent of the Company; and

6.1.3                                           not to make or cause to be made any derogatory comments
about the Company or any of its respective officers or employees or relating to
any Group Company or take part in any conduct conducive or potentially
conducive to the bringing of the Company or any of its respective officers or
employees into disrepute.

6.2                                 The Company undertakes not to authorise or instruct any of its officers
or employees:

6.2.1                                           to
disclose the terms of this Agreement to any
third parties other than to the Company’s professional advisers, the Inland
Revenue or as may be required by law provided always that disclosure to its
professional advisers shall be on terms that they agree to keep the same
confidential; and

6.2.2                                           to make or cause to be made any derogatory comments
about the Employee or take part in any conduct conducive or potentially
conducive to the bringing of the Employee into disrepute.

7.                                       CONTINUING OBLIGATIONS

7.1                                 The
Employee agrees to continue to be bound by paragraphs 7, 8  and 15 of the Contract of Employment. A copy
of the Contract of Employment is attached at Exhibit
1.

7.2                                 The
Company agrees to release the Employee from his obligations under
paragraph  14 of the Contract of
Employment only to the extent that he will be free to seek alternative
employment with and enter into a new contract of employment with a prospective
employer before the Departure Date provided that such prospective employer is
not a business in competition with the Company and provided that the
commencement of any such employment will be not be before 1 January 2005.

8.                                       RETURN OF PROPERTY

8.1                                 The
Employee warrants that he will return to the Company on or before the Departure
Date all equipment, documents, computer discs, computer software and hardware,
portable telephones, note specifications, plans keys, client lists, reports and
any other property (including copies, summaries and excerpts) belonging to or
relating to the business of the Company or created by the Employee in the
course of his employment with the Company and which have been or are in his
possession or control (without keeping any copies, summaries or excerpts).

9.                                       RESIGNATION OF DIRECTORSHIPS

9.1                                 The
Employee agrees that he shall resign from all offices which he holds as a
director of the Company or any Group Company on signature of this agreement by
way of the letter of resignation as  set
out in Schedule 1.

9.2                                 Having
resigned as a director of the Company and any Group Company, the Employee will
not hold himself out as being a director of the Company or any Group
Company.  After the Departure Date the
Employee will not hold himself out as being employed by the Company

 

5

                or any Group Company or as
having any continued authority or connection in respect of the Company or any
Group Company.

10.                                 ASSISTANCE

10.1                           Notwithstanding
the termination of his employment, the Employee shall co-operate with the
Company by providing such reasonable assistance as may be required in
connection with any claims made by or against the Company or any of its
officers or employees where it considers that the Employee has relevant
knowledge or information, and such assistance may include attendance at
meetings and hearings and giving statements and evidence. The Company shall
reimburse the Employee for his reasonable out-of-pocket expenses incurred (subject
to receipt of satisfactory evidence of such expenses and provided that prior
authorisation from the Company is obtained) and pay him reasonable compensation
in relation to time spent in attendance at any employment tribunal or court
hearings.

10.2                           The
Employee agrees to use his reasonable endeavours to assist the Company in
ensuring a smooth transition of his responsibilities to his successor both
before the Departure Date and up to one month thereafter.

10.3                           The
Employee agrees to provide his reasonable cooperation until the Departure Date
in connection with the announcement of his departure from the Company to
include internal announcements and any press releases .

11.                                 REFERENCES

11.1                           The
Company agrees that upon receiving a request for a reference from a prospective
employer of the Employee it will provide to that prospective employer a
reference in the terms of Schedule 3
hereto (such request to be addressed to the Human Resources Director) unless at
the time of such request facts or matters have become known to the Company
which renders the reference untrue and/or misleading..  The Company agrees not to derogate from the
terms of the above reference in response to any enquiry made by a prospective
employer.

12.                                 LEGAL COSTS

12.1                           The Company agrees to pay the reasonable legal costs
incurred by the Employee solely in connection with this Agreement and the
termination of his employment, such costs not to exceed £1,000.00 (one thousand
pounds) inclusive of VAT.  These costs
will be paid to the Employee’s solicitor within 30 days of receipt by the
Company of the Employee’s solicitor’s bill addressed to the Employee but marked
payable by the Company.

13.                                 SHARE OPTIONS

13.1                           The
Employee shall be entitled to exercise any share options which have vested at
31st December 2004 under the Stock Option Plans within 90 (ninety)
days of the Departure Date.  All other
share options will lapse on the Departure Date.

13.2                           The
Employee agrees to comply with the SeeBeyond Technology Corporation insider
trading policy (a copy of which the Employee has received) in its entirety.
Additionally and for the avoidance of doubt, the Employee understands and
agrees that he shall not trade in SeeBeyond Technology Corporation stock or
exercise SeeBeyond Technology Corporation share options during the period
commencing 15 December 2004 until 48 hours after the official SeeBeyond
Technology Corporation earnings call in 2005 which reports the earnings for the
fourth quarter of 2004.

14.                                 STATUTORY COMPROMISE

14.1                           The
conditions regulating compromise agreements under section 77 of the Sex
Discrimination Act 1975, section 72 of the Race Relations Act 1976, section 288
of the Trade 

 

6

 

                Union and Labour Relations
(Consolidation) Act 1992, section 9 of the Disability Discrimination Act 1995,
section 203 of the Employment Rights Act 1996, section 49 of the National
Minimum Wage Act 1998, Regulation 35 of the Working Time Regulations 1998,
section 41 of the Trans-national Information and Consultation of Employees
Regulations 1999, section 9 of the Part-time Workers (Prevention of Less
Favourable Treatment) Regulations 2000, section 10 of the Fixed-term Employees
(Prevention of Less Favourable Treatment) Regulations 2002, Regulation 35 of
the Employment Equality (Sexual Orientation) Regulations 2003 and Regulation 35
of the Employment Equality (Religion or Belief) Regulations 2003 are satisfied
in relation to this Agreement.

14.2                           It
is a condition of this Agreement that the Employee takes independent legal
advice. The Employee confirms that the solicitor named below has given him
independent legal advice as to the terms and effect of this Agreement and in
particular on its effect on his ability to pursue his rights before an
employment tribunal. In light of this advice the Employee has agreed to the
terms and conditions set out in this Agreement.

15.                                 GENERAL

15.1                           Any
officer or employee of the Company  or any Group Company may enforce
the terms of this Agreement referable to them subject to and in accordance with
the provisions of the Contracts (Rights of Third Parties) Act 1999.

15.2                           Although
marked “Without Prejudice” and “Subject to Contract”, once signed by the
Parties this Agreement shall have full force and effect and may be disclosed in
evidence if required by operation of law.

15.3                           References
in this Agreement to any statute or statutory provision include reference to
that statute or statutory provision as modified, amended or re-enacted.

15.4                           Clause
headings shall not effect the interpretation of this Agreement.

15.5                           This
Agreement shall be construed in accordance with the law of England and Wales
and the Parties submit to the exclusive jurisdiction of the English Courts.

 

	
  SIGNED by James T. Demetriades

  for and on behalf of

  	
  /s/ James
  T. Demetriades

  
	
  SEEBEYOND (UK) LIMITED

  	
  James T. Demetriades

  Chief Executive Officer

  
	
   

  	
  December 9, 2004

  
	
   

  	
  Date

  
	
   

  	
   

  
	
  SIGNED
  by Alistair David Bennett

  	
  /s/ David
  Bennett

  
	
   

  	
  Alistair David Bennett

  
	
   

  	
  December 9, 2004

  
	
   

  	
  Date

  

To be
completed by the solicitor referred to in clause 13.2 of this Agreement above:

 

1.                                       I am
a solicitor of the Supreme Court of England and Wales holding a current and
valid practising certificate.

 

7

 

2.                                       I
confirm that I have given independent legal advice to the Employee as to the
terms and effect of this Agreement between him and the Company and, in
particular, its effect on his ability to pursue his rights before an employment
tribunal following its signing.

3.                                       I
confirm that there is in force an indemnity or insurance covering the risk of a
claim by the Employee in respect of loss arising in consequence of the advice I
have given.

 

	
  SIGNED by  Shilpen Savani

  	
   

  
	
   

  	
  Shilpen Savani

  Solicitor

  
	
   

  	
   

  
	
   

  	
  Date

  
	
   

  	
   

  
	
  Name of Solicitor:

  	
   

  
	
  Name & Address of
  Firm:

  	
  Cannings Connolly

  Hill Gate House

  26 Old Bailey

  London

  EC4M 7HQ

  

 

 

8

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