Document:

exv10w1

 

Exhibit 10.1

*   CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED
AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION.

MASTER SERVICES AGREEMENT

This MASTER SERVICES AGREEMENT (the “Agreement”) is entered into effective April 9, 2004 (the
“Effective Date”), by and between the following Parties:

	 	 	 
	PeopleSupport, Inc.

	 	Vonage Holdings Corp.
	1100 Glendon Avenue, Suite 1250

	 	2147 Route 27
	Los Angeles, CA 90024

	 	Edison, NJ 08817
	 
	 	 
	Hereinafter referred to as “PeopleSupport”

	 	Hereinafter referred to as “Client”

The Parties agree as follows:

	1.	 	SERVICES
	 
	A.	 	Description. PeopleSupport will provide to Client the services set forth herein and in
Exhibit A attached hereto (“Services”) out of one or more of its contact centers. If and as
specified in the Statement of Work (“SOW”) attached hereto as Exhibit A, the Services will
include the provision of equipment, software, telecommunication lines and other facilities
specified as well as the training and human support specified in the SOW. In support of the
Services, Client will provide the items specified as its responsibilities herein, and in the
SOW.
	 
	B.	 	Additional SOWs and Change Orders. The parties may mutually agree on additional SOWs, which
will reference the terms and conditions of this Agreement and will become effective upon
mutual execution thereof. During the performance of the Services, Client may request in
writing, and PeopleSupport may agree, to make material changes in this Agreement, or in the
Services, and/or to add services which are not described in a SOW. In addition, changes to
the Services may be necessary due to changes in the Client’s volume, pattern, or types of its
services and/or products, and/or changes to the Client Provided Technology (defined in Section
4D). Such additional or materially changed services (“Additional Services”) will be subject to
a written, mutually agreed-upon change order to an SOW (“Change Order”), including applicable
pricing and terms. Upon the mutual execution of any such Change Order, the Services will be
deemed to include such Additional Services. Unless and until the parties mutually execute
such Change Order, only the terms of this Agreement and the applicable SOW will apply. The
parties agree that an authorized representative of Client may indicate its acceptance of
Change Orders either in accordance with the “Notices” provision of this Agreement or by
facsimile signature, each of which shall be subject to countersignature by an authorized
representative of PeopleSupport.
	 
	2.	 	TERM AND TERMINATION
	 
	A.	 	Term. The initial term of this Agreement (the “Term”) will commence on the Effective Date and
will extend for one (1) year from the date the Services are deemed operational (e.g first “live”
date of Service). The Agreement, including Exhibit A, will automatically renew for successive
*** year terms unless either Party provides written notice of its intent not to renew at least
*** before the expiration of the initial Term or at least *** before the expiration of any
subsequent renewal Term, or unless terminated earlier as otherwise provided herein or in Exhibit
A. The term of additional SOW(s) will be as set forth in such
SOW(s)
	 
	B.	 	Effect of Termination. Except as otherwise provided herein, in the event either Party
terminates an SOW for an Event of Default pursuant to Section 8, unless the termination
expressly applies to all other SOWs or to the operation of the Agreement as a whole, such
termination as to one SOW will not constitute termination with respect to any other SOW(s) or
the Agreement.
	 
	C.	 	Minimum Payments. In the event that PeopleSupport terminates one or more SOWs due to
Client’s Event of Default pursuant to Section 8, or if Client terminates one or more SOWs in
violation of this Agreement or of the applicable SOW, Client will pay to PeopleSupport ***, as
specified herein or in the applicable SOW.
	 
	D.	 	Termination Within First Thirty Days. Notwithstanding anything to the contrary in this
Agreement or in any SOW, Client may, at any time on or before the thirtieth (30th)
day after the initial minimum number of *** FTE employees are fully trained, out of nesting
and begin performing services pursuant to the initial SOW hereunder, terminate this Agreement
or any SOW for convenience and upon *** days written notice provided that in the event of such
termination for convenience, Client shall pay to PeopleSupport, as PeopleSupport’s *** remedy
for such termination, the sum of *** plus charges for those Services listed of Appendix A of
SOW #1 rendered through the effective date of termination calculated in accordance with the
prices set forth on that Appendix irrespective of any minimum commitment, which shall be
payable within ten (10) business days after the effective date of such termination.

 

			
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	E.	 	Survival. Any and all obligations under this Agreement, including any SOW then in effect
which, by their nature should reasonably survive the termination or expiration of this
Agreement or such SOW, will so survive, including, but not limited to, Client’s payment
obligations, and the obligations of both Parties arising from the confidentiality and
non-solicitation provisions of this Agreement.
	 
	3.	 	PRICING AND PAYMENT
	 
	A.	 	Prices and Invoicing. Client agrees to pay PeopleSupport for the Services according to the
prices set forth below and in any mutually agreed SOW or Change Orders. Amounts payable are
subject to the adjustment(s) by PeopleSupport or Client as specified in the SOW or Change
Orders, with respect to each SOW. Client agrees to pre-pay to PeopleSupport the ***, as
specified in an SOW ***, on or before the *** day of each calendar month (“Minimum Monthly
Fee”), notwithstanding the volume of Services actually provided in a month. The Minimum
Monthly Fee is not subject to any discounts. If the first or last month of the Term is a
partial month, the Minimum Monthly Fee for such month may be prorated based on a thirty (30)
day month. At the end of each calendar month, PeopleSupport will invoice Client for Services
actually rendered in such month, reflecting a credit for the Minimum Monthly Fee pre-payment.
All amounts payable, as set forth on each invoice, will be itemized by the applicable Service
and by the units set forth in the applicable SOW or Change Order, in sufficient detail to
make clear to Client how such amounts were calculated. Payments are due within *** following
date of invoice. Billing per FTE committed by Client will be on a forty hours week basis.
	 
	B.	 	Reimbursement for Expenses. Subject to Client’s prior written approval of the incurrence and
amount of such expenses or charges, Client will reimburse PeopleSupport for: a) all
reasonable and actual travel and related living expenses incurred by PeopleSupport related to
the Services, in accordance with PeopleSupport’s standard travel guidelines, provided that
such reimbursement will be solely for travel expressly requested by Client and only to the
extent that such travel was not reasonably foreseeable as necessary in carrying out
PeopleSupport’s responsibilities under an SOW or Change Order at the time such SOW or Change
Order was agreed to; b) if and as expressly specified in Exhibit A and/or an applicable SOW
or Change Order, any telecommunications, installation, maintenance and recurring charges for
equipment and facilities acquired for the provision of the Services to Client and used solely
for that purpose that are not Client-Provided Technology as defined below, and c) any other
expenses or charges expressly specified in an applicable SOW or Change Order or otherwise
authorized in writing by Client.
	 
	C.	 	Electronic Invoicing and Wire Transfer Payment. Client acknowledges that invoices from
PeopleSupport will be sent electronically, and Client agrees to make all payments to
PeopleSupport via wire transfer. Payments of amounts due will be wired via the U.S. Federal
Reserve System to:

     ***

	D.	 	Effect of Non-Payment. In the event any amounts due are not paid within *** after they are
due, such amounts will accrue late charges at the lesser of the rate of *** per month or the
highest rate allowed by applicable law, from the due date. Payments subsequently received
from Client will be first applied to such late charges, then to amounts past due, and then to
current amounts due.
	 
	E.	 	Taxes. Client will be solely responsible for, and will pay, any use, excise, sales or
privilege taxes, duties, value added taxes, fees, assessments or similar liabilities however
denominated which may now or hereafter be levied on the provision by PeopleSupport of
Services, software, equipment, materials or other property (tangible or intangible) provided
under this Agreement, chargeable to or against PeopleSupport by any applicable government
authority. PeopleSupport will separately invoice any such taxes of which it is aware on its
invoice. Should PeopleSupport be required to pay or should PeopleSupport pay these taxes,
fees, assessments or similar liabilities, Client will promptly reimburse PeopleSupport for
such payments upon receipt of invoice. The foregoing will not apply to any taxes based upon
the net income, employment or property of PeopleSupport or franchise or similar fees paid by
PeopleSupport for the privilege of doing business in any jurisdiction.
	 
	F.	 	Right to Dispute Invoices. Client will not withhold any undisputed portion of any amounts
payable hereunder but may withhold disputed amounts upon written notice of a dispute. Unless
Client provides PeopleSupport with notice in writing of a dispute regarding the amounts due
hereunder within *** after Client’s receipt of the invoice on which such amounts appear,
including the basis for such dispute, the invoice will be deemed approved by Client and the
right to dispute any such amounts invoiced will be deemed waived. Unless PeopleSupport
invoices Client for Services or other charges within *** after such Services are rendered or
such other charges are incurred, all such Services and/or other charges will be deemed waived
and Client will have no obligation to pay them.
	 
	4.	 	CLIENT OBLIGATIONS FOR INFORMATION AND TECHNOLOGY 
	 
	 	 	In order for PeopleSupport to provide the Services, Client agrees to provide the following to
PeopleSupport, as and when reasonably requested by PeopleSupport:
	 
	A.	 	Volume, Pattern and Handling Forecasts. Client will provide good faith, volume, pattern and
handling time forecasts as and to the extent specified in the applicable SOW; provided that
PeopleSupport’s sole remedy for erroneous forecasts shall be as set forth in the applicable
SOW. All such forecasts will be

 

			
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	 	 	deemed Client’s confidential information subject to PeopleSupport’s obligations as set forth
in Section 7. PeopleSupport shall reasonably determine the number of persons that are required
to be trained in light of such forecasts, and will not be required to have prior approval from
Client to hire and/or train them, though PeopleSupport will make every reasonable effort to
communicate any planned training with Client, and Client shall have no obligation with respect
thereto except as expressly specified in an applicable SOW.
	 
	B.	 	Forecasts for Special Promotions and Advertising. Client will provide notice of and forecasts
related to all media promotions (including, but not limited to, radio, television, direct
mail, Internet and other media) within a reasonable amount of time before the start of the
promotion, so that PeopleSupport can make appropriate staffing or other adjustments and so
that the parties may agree on appropriate Change Order(s), if necessary. All such notice and
forecasts will be deemed Client’s confidential information subject to PeopleSupport’s
obligations as set forth in Section 7.
	 
	C.	 	Product Literature and Related Materials. Client will provide all information, sales and
product literature (including updates and/or modifications), and if applicable, samples and
any other materials related to Client’s services and/or products, which are reasonably
necessary for PeopleSupport to provide the Services. PeopleSupport may copy all such
information, sales and product literature and other materials solely for purposes of providing
Services.
	 
	D.	 	Client-Provided Technology. If and to the extent specified in Exhibit A, Client will provide
any necessary hardware, software, telecommunication systems and similar materials
(collectively, the “Client Provided Technology”), and the right to use such Client Provided
Technology, solely in order to perform the Services, including as specified in Exhibit A:

	 	i)	 	Software and hardware specific to Client (as defined in Exhibit A), including legacy
systems, terminal emulation and required applications not already part of PeopleSupport’s
infrastructure;
	 
	 	ii)	 	Maintenance for the Client-Provided Technology; and
	 
	 	iii)	 	All training materials and any additional training reasonably required by PeopleSupport
and approved by Client with respect to new or revised Client-Provided Technology.

	 	 	Client will be responsible for the installation of the Client-Provided Technology and for the
maintenance and repair of, and any changes, updates and upgrades to the Client-Provided
Technology. Client agrees to provide to PeopleSupport upon request copies of any licenses or
other legal requirements applicable to the Client-Provided Technology, and PeopleSupport agrees
to comply with all such licenses and other legal requirements. In the event it becomes
necessary as specified in any SOW or Change Order for Client to provide any additional
Client-Provided Technology, including increasing the scope of use of any licensed software,
Client will obtain and provide to PeopleSupport such additional Client-Provided Technology.
	 
	E.	 	Information Necessary for the Performance of Services. The information provided by Client to
PeopleSupport, as required hereunder, including necessary instructions for communications with
Client’s prospective customers and/or customers, will be accurate to the best of Client’s
knowledge and belief. Client will respond promptly and accurately to all reasonable requests
for such information made by PeopleSupport, and provide relevant new data and regular updates
of changes to data previously provided. PeopleSupport personnel will not make any
representations to any person that are inconsistent with the information provided by Client,
and PeopleSupport will be solely responsible for any misrepresentations made by its personnel
to the extent such misrepresentations are not contained in information provided by Client.
Without limiting the generality of the foregoing, Client agrees to provide necessary login
identification and passwords for any of its applications to be used by PeopleSupport as
specified in an applicable SOW or Change Order, within no more than two (2) business days
following PeopleSupport’s request. In addition, Client shall provide PeopleSupport with
reasonable access to any of its systems, software and files provided to PeopleSupport and/or
installed at PeopleSupport’s facilities. PeopleSupport shall be entitled to rely upon written
information or instructions received from authorized Client personnel, including those sent
electronically via email.
	 
	5.	 	JOINT OBLIGATIONS OF THE PARTIES
	 
	A.	 	Contact Person. Each Party will designate a single point of contact with the authority to
discuss and resolve day-to-day issues and the relations between the Parties relating to the
Services, such as the provision of information, reports, and the Client-Provided Technology.
Such contact person may be changed upon written notice to the other Party.
	 
	B.	 	Compliance with Law and Agreements. Each of the Parties will perform its obligations under
this Agreement in compliance with all applicable laws, ordinances and regulations, and will
obtain and maintain in full force and effect, any permits, licenses, consents, approvals and
authorizations necessary for the performance of its obligations hereunder. To the extent that
Client is responsible for the provision of information regarding its prospective customers
and/or customers, and the provision of scripts or other instructions to be followed by
PeopleSupport, Client will be responsible for confirming that such lists and/or instructions
comply with applicable law and that, by following Client’s instructions, PeopleSupport is not
violating any law or regulation, and is not subject to any obligation to any third party.
PeopleSupport will be responsible for ensuring that its personnel follow all instructions from
authorized Customer personnel. To the extent that either Party requires the license or other
consent of a third party to provide software, data, materials, or other items to the other
Party hereunder, the Party providing such items shall have and maintain any such consent, in
substance and form reasonably acceptable to the other Party, and shall provide evidence of
such consent to the other Party, upon request.

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	C.	 	Further Documents and Cooperation. Each Party will execute such other documents, and provide
such cooperation as the other Party reasonably requests, in order to give full effect to the
provisions related to this Agreement, including, but not limited to, the provisions of this
Agreement related to the ownership of rights.
	 
	D.	 	Timeliness of Compliance. Any delay by a Party in the performance of its obligations will
extend the time for performance by the other Party of such of the other Party’s obligations
that are affected by such delay by an amount of time reasonably required to compensate for
such delay.
	 
	6.	 	OWNERSHIP AND INTELLECTUAL PROPERTY RIGHTS
	 
	A.	 	Pre-Existing and Independently Developed Works. Each Party will retain all rights in any
software, ideas, concepts, know-how, processes, development tools, techniques or any other
proprietary material or information that it owned or developed prior to the date of this
Agreement, or acquires or develops after the date of this Agreement without use or
incorporation of the intellectual property of the other Party.
	 
	B.	 	Client’s Ownership Rights. As between PeopleSupport and Client, Client will own all
Client-Provided Technology and customer data provided and/or collected pursuant to the
performance of Services. During the term of this Agreement and/or the applicable SOW, Client
grants to PeopleSupport a non-exclusive license and right to use such Client-Provided
Technology and customer data, solely for purposes of the performance of Services.
PeopleSupport will not reproduce or distribute the Client-Provided Technology, or copy it to
any server or location for reproduction or distribution, for any other purpose whatsoever.
People Support may not reverse engineer, decompile or disassemble the Client-Provided
Technology. Subject to any third party rights or restrictions and the other provisions of
this Section, Client will own any deliverables that are specified to be owned by Client in the
applicable SOW, which: (i) are custom developed specifically for Client, and (ii) are paid for
by Client. PeopleSupport will deliver such Client-owned deliverables, and return all
Client-Provided Technology, to Client upon expiration or termination of this Agreement or the
applicable SOW.
	 
	C.	 	PeopleSupport Ownership Rights. PeopleSupport retains all right, title and interest in and to
all software development tools, know-how, methodologies, processes, technologies and/or
algorithms used in performing the Services which are based on trade secrets or proprietary
information of PeopleSupport or are otherwise owned or licensed by PeopleSupport. Insofar as
PeopleSupport is in the business of creating innovations in its industry, PeopleSupport will
be free to use any ideas, concepts, know-how and other intellectual property which are
developed or created solely by PeopleSupport in the course of performing the Services,
provided that PeopleSupport will not be permitted to incorporate any Client-Provided
Technology or other Client intellectual property therein or to create any derivative works of
Client-Provided Technology or other Client intellectual property. PeopleSupport will retain
ownership of any PeopleSupport-owned intellectual property rights as incorporated into
software or tools that are used in producing any deliverables, even if such ideas, concepts,
know-how or other intellectual property is used or embedded in such deliverables, provided
that Client is hereby granted a royalty-free, nonexclusive license to .such intellectual
property rights to the extent incorporated into any such deliverables. Client will not
reproduce or distribute the PeopleSupport intellectual property, or copy it to any server or
location for reproduction or distribution, for any purpose other than to make use of such
deliverables or otherwise in connection with its receipt of Services and the performance of
its obligations under this Agreement. Client may not reverse engineer, decompile or
disassemble the PeopleSupport intellectual property.
	 
	D.	 	Permitted Use of Marks. Each Party warrants and represents that it has full right, title and
interest in and to all trade names, trademarks, service marks, symbols and other proprietary
marks (“Marks”) which it provides to the other Party, if any, for use related to the Services,
and that any Marks provided by a Party will not infringe the marks of any third party. As
necessary for the performance of the Services, the providing Party grants to the other Party
the non-exclusive right to reasonably utilize the Marks solely in connection with the
performance of the obligations of the parties hereunder, including, but not limited to,
internally on signs or posters (e.g., to identify Client’s part of a facility, if applicable,
or for internal promotions), in PeopleSupport newsletters, closed-circuit television and
training. Any specific use by PeopleSupport of Client’s Marks shall be subject to Client’s
written approval, which may be granted or withheld by Client in its sole discretion, and
PeopleSupport will adhere to any written guidelines for the use of Client’s Marks that may be
promulgated by Client from time to time. Each Party agrees to use the other Party’s Marks
only for the agreed-upon purposes. Upon reasonable request, the providing Party will provide
to the receiving Party, camera and/or video ready art, and/or digital tiff, eps or bitmap
files of the providing Party’s Marks.
	 
	7.	 	CONFIDENTIALITY
	 
	A.	 	Confidentiality. Each Party, including such Party’s employees, agrees to keep confidential the
other Party’s confidential and proprietary information and not use it for any purpose other than to
perform its obligations under this Agreement. Each Party agrees that the following will be deemed
to have been received in confidence and will be used only for purposes of this Agreement: (i) all
information communicated to it by the other and identified as confidential, whether before or after
the Effective Date, (ii) all information identified as confidential to which it has access in
connection with the Services, whether before or after the Effective Date, (iii) all information,
whether or not so identified, that a reasonable businessperson would understand to be confidential
by reason of its nature or content; and (iv) the terms of this Agreement and the Parties’ rights
and obligations hereunder. Each Party agrees to use the same means as it uses to protect its own
confidential information, but in no event less than reasonable care, to prevent the disclosure and
to protect the confidentiality of the confidential information of the other Party. No such
information will be disclosed to third parties by the recipient Party without the prior written
consent of the disclosing Party; provided, however, that each recipient Party may disclose
confidential information of the

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other Party to those of the recipient Party’s attorneys, auditors, insurers, vendors and
subcontractors who have a need to have access to such information in connection with their
engagement, provided that such persons and entities will be bound by non-disclosure obligations
equivalent to those set forth herein.

	B.	 	Exceptions. Notwithstanding the other provisions of this Section, neither Party will be
prevented from disclosing the confidential information of the other Party (i) which, at the
time of disclosure, was in the public domain, (ii) which was lawfully disclosed on a
non-confidential basis by a third party who is not bound by a confidentiality agreement with
the other Party, (iii) which is disclosed with the other Party’s prior written approval, or
(iv) in response to valid legal process, whether issued by a court or administrative or
regulatory body or for purposes of legal or regulatory compliance. If confidential
information of a Party is required to be disclosed by the other Party pursuant to a
requirement of a legal process or for purposes of legal or regulatory compliance, the Party
required to disclose the confidential information, to the extent possible, will provide the
other Party with timely prior notice of such requirement and will coordinate with such other
Party, at such other Party’s expense, in an effort to limit the nature and scope of such
required disclosure, where appropriate. Upon the expiration or termination of this Agreement
for any reason, all such confidential information (and all copies thereof) owned by the
disclosing Party will be returned to the disclosing Party or will be destroyed, except that
any archival copies may be retained, subject to the continuation of the confidentiality
obligations hereunder.
	 
	8.	 	EVENTS OF DEFAULT 
	 
	 	 	Subject to any applicable notice and cure provisions, the following are “Events of Default”
under this Agreement, and give rise to the remedies set forth herein:
	 
	A.	 	Failure to Pay Amounts When Due. Client’s failure to pay amounts payable hereunder when due
shall constitute an Event of Default. Client shall have ten (10) days after receipt of
written notice to cure any such payment default. The foregoing notwithstanding, PeopleSupport
shall have the right to suspend Services, without the provision of further written notice, if
Client fails to cure such payment default within such ten (10) day period.
	 
	B.	 	Failure of a Party to Perform Its Material Obligations. A Party’s failure to substantially
perform any other material obligation under this Agreement, including any SOW, will constitute
an Event of Default. In the event that a Party fails to remedy such an Event of Default within
thirty (30) days after receipt of written notice thereof, the non-defaulting Party may suspend
or terminate the affected SOW, provided that, if such Event of Default cannot practicably be
cured within such thirty 30-day period and is susceptible to a cure, then the defaulting Party
will not be considered in default if it commences to cure within the initial thirty (30)-day
period and in good faith diligently and continuously proceeds to cure the default.
	 
	C.	 	Bankruptcy and Similar Proceedings. The following are additional Events of Default,
requiring no written notice or cure period, and the non-defaulting Party may terminate this
Agreement immediately in the event of any of them:

	 	i)	 	The commencement of any involuntary proceeding in bankruptcy or insolvency under
federal or state law or the appointment of a receiver or an assignee for the benefit of
creditors for a substantial portion of a Party’s assets which is not dismissed or
terminated within sixty (60) days after its initiation; or
	 
	 	ii)	 	The commencement of any voluntary proceeding in bankruptcy or insolvency under federal
or state law, or the voluntary appointment of a receiver or an assignee for the benefit of
creditors; or
	 
	 	iii)	 	A Party ceases to do business in the normal course, or is unable to pay its debts when
they become due.

	9.	 	LIMITED WARRANTY; DISCLAIMER; LIMITATION OF LIABILITY

	A.	 	Limited Warranty. PeopleSupport agrees to perform the Services with a reasonable degree of
care, skill and competence, and in accordance with any and all performance objectives
established by the Parties in any SOW. PeopleSupport’s sole liability, and Client’s sole
remedy under this limited warranty, will be as follows: (i) PeopleSupport will re-perform any
non-conforming Services within after receipt of notice from Client as to such non-conformance;
and (ii) in the event of *** or more months of such non-conformances under *** of the SOW
within *** month period (except where the applicable service level is measured on *** basis,
in which case the standard for termination is *** in any rolling *** period), Client may
terminate the affected SOW(s) or this Agreement without liability upon *** written notice to
PeopleSupport. Client will monitor Services in order to determine whether PeopleSupport has
met its warranty obligation hereunder. In the event Client does not provide notice to
PeopleSupport of such non-conformance within ninety (90) days after performance of Services,
such Services will be deemed finally accepted by Client.

	B.	 	DISCLAIMER OF OTHER WARRANTIES. EXCEPT AS EXPRESSLY STATED HEREIN, THE SERVICES ARE
PROVIDED “AS IS,” AND PEOPLESUPPORT DOES NOT MAKE, AND HEREBY DISCLAIMS, ANY AND ALL OTHER
EXPRESS AND ANY IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND ANY WARRANTIES ARISING FROM A COURSE OF
DEALING, USAGE OR TRADE PRACTICE. PEOPLESUPPORT DOES NOT WARRANT THAT THE SERVICES WILL BE
UNINTERRUPTED OR ERROR FREE, OR COMPLETELY SECURE, DESPITE THE REASONABLE PRECAUTIONS SET
FORTH IN THE APPLICABLE SOW.

	C.	 	LIMITATION OF LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY SPECIAL,
INDIRECT, EXEMPLARY, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING UNDER OR

 

			
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RELATING TO THIS AGREEMENT IN ANY WAY, INCLUDING, BUT NOT LIMITED TO, LOSS OF DATA, LACK OF
SERVICES, OR LOSS OF REVENUES OR PROFITS, EVEN IF A PARTY HAS BEEN ADVISED, KNOWS OR SHOULD KNOW OF
THE POSSIBILITY OF THE FOREGOING. EXCEPT IN THE CASE OF ITS INDEMNITY OBLIGATIONS PURSUANT TO
SECTION 10 AND CLIENT’S OBLIGATION TO PAY CHARGES PURSUANT TO THIS AGREEMENT, EACH PARTY’S MAXIMUM
LIABILITY TO THE OTHER PARTY ARISING UNDER OR IN RELATION TO THIS AGREEMENT FOR ANY AND ALL CLAIMS,
LOSSES OR DAMAGES, AND REGARDLESS OF THE FORM OF ACTION (I) WILL BE LIMITED TO ***.

	10.	 	INDEMNIFICATION 

	A.	 	Mutual Indemnification for Certain Third Party Claims. Each Party (“Indemnifying
Party”) agrees to indemnify, defend and hold harmless the other Party, including its
affiliates, and its and their respective shareholders, partners, members, directors, officers,
attorneys, representatives, employees, and agents, and its and their successors and permitted
assigns (collectively “Indemnified Parties”) from any and all third party suits and claims for
losses and threatened losses, including any criminal, administrative, or investigative action
or proceeding, arising from or in connection with, or based on allegations (i) arising out of
or based on the Indemnifying Party’s breach of the obligations under Section 5(B) (Compliance
with Law); (ii) relating to the death or bodily injury of any person caused by the tortious
conduct of the indemnifying Party; (iii) the damage, loss or destruction or any real or
tangible personal property caused by the tortious conduct of the Indemnifying Party; or (vi)
asserting infringement of any third party intellectual property right by any patent,
copyright, trademark, service mark, trade name, trade secret or similar proprietary rights
regarding intellectual property (or license, access or use rights therein) provided by the
Indemnifying Party to the Indemnified Party under this Agreement including but not limited to
those items provided under Section 4(D) (“Client-Provided Technology”) and/or Section 4(E)
(“Information Necessary for Performance of Services”). People Support will, in addition,
indemnify, defend and hold harmless Client for any misrepresentations made by PeopleSupport
personnel to the extent such misrepresentations are not contained in or reasonably derived
from information provided by Client.

	B.	 	Indemnification Procedure. Each Party’s obligation to indemnify the other Party
pursuant to this provision will apply only to the extent that the Party seeking
indemnification: (i) promptly after receipt of notice of the commencement or threatened
commencement of any civil, criminal, administrative, or investigative action or proceeding
involving a claim in respect of which any of the Indemnified Parties will seek
indemnification, notifies the Indemnifying Party of such claim in writing; (ii) allows the
Indemnifying Party to control, and fully cooperates with the Indemnifying Party in the defense
of any such claim; and (iii) does not enter into any settlement or compromise in respect of
such claim without the Indemnifying Party’s prior written consent. Failure to so notify the
Indemnifying Party of a claim will not relieve the Indemnifying Party of its obligations under
this Agreement except to the extent that it can demonstrate that it was prejudiced by such
failure.

	11.	 	ADDITIONAL PROVISIONS

	A.	 	Insurance. Prior to the commencement of Services to be performed hereunder and throughout
the Term of this Agreement and any SOW, each of the Parties will procure and maintain
commercially reasonable policies of liability and errors and omissions insurance, in such
forms as are appropriate based on the nature of the Services and the respective obligations of
the parties. During the Term of this Agreement, PeopleSupport will maintain, at its sole
expense, all appropriate insurance for its employees, including, required worker’s
compensation, disability, and unemployment insurance. In the event the Service includes the
offer or sale of products of or for Client, Client will be solely responsible for providing to
PeopleSupport evidence of reasonably appropriate product liability insurance, such as a
certificate of insurance naming Client and PeopleSupport as additional insured, as provided by
the applicable manufacturer, distributor or other seller of such product.

	B.	 	Non-Solicitation of Employees. During the Term of this Agreement and for a period of ***
after the date of termination of this Agreement, neither Party will knowingly, directly or
indirectly, solicit any of the other Party’s employees who, in any manner, have worked in the
provision of any of the Services. The use of general advertisements which do not target
certain employees or groups will not be construed to violate this provision.

	C.	 	Relationship Between the Parties. PeopleSupport is engaged hereunder solely in the capacity
as an independent contractor, and no employment, partnership or joint venture relationship is
intended to be created hereby. In no event will either Party have the power to bind the other.

	D.	 	Force Majeure and Other Delays. For purposes of this Agreement, a “Force Majeure” will mean a
cause outside of a Party’s reasonable control including, without limitation, acts of God,
acts of war, revolution, riots, civil commotion, acts of a public enemy, terrorism, embargo,
acts of government in its sovereign capacity, strikes, lockouts, boycotts, fire, earthquakes,
floods or other natural disasters. Except for the payment of moneys when due and owing, to
the extent that a Party is unable to fulfill, in whole or part, its obligations hereunder,
where such inability arises by reason of an event of Force Majeure, or in the event a Party is
unable to perform its obligations due to the failure of the other Party to perform

 

			
	*	 	CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

PEOPLESUPPORT, INC. AND VONAGE HOLDINGS CORP. CONFIDENTIAL

6

 

its obligations, such Party will be temporarily excused from fulfilling such obligations under
the applicable SOW until the abatement of such Force Majeure event or until the other Party
performs its those obligations necessary for performance by the Party which is unable to perform.
In the event PeopleSupport is prevented from providing any of the Service by a Force Majeure event,
Client will receive a pro rata credit of the Minimum Monthly Fee based on the amount of time
PeopleSupport is unable to provide such Service. In the event such inability persists more than
***, Client may terminate any affected SOW(s) or this Agreement without liability.

	E.	 	Governing Law and Interpretation. This Agreement will be deemed accepted by PeopleSupport in,
and governed by and construed in accordance with, the laws of *** without giving effect to its
conflicts of law provisions. As references to the term “including” or “such as” shall be
construed to mean “including but not limited to”, and shall not be deemed limiting. In any
case where consent is to be requested by a Party, such consent shall not be unreasonably
withheld or delayed.

	F.	 	Waivers. Failure to enforce compliance with any term or condition of this Agreement will not
constitute a waiver of such term or condition of this Agreement or the right to subsequently
enforce such term or condition in the future.

	G.	 	Severability. In the event that any provision of this Agreement is held or construed be
invalid by any arbitrator or court having jurisdiction over disputes related to this
Agreement, such provision will, if reasonable to do so, be restated to reflect as nearly as
possible the original intentions of the Parties in accordance with applicable law or, if not
reasonable to do so, be deemed to be excluded from this Agreement. In any event, all other
provisions of this Agreement will remain in full force and effect.

	H.	 	Notices. Except as specifically provided elsewhere in this Agreement, all notices required or
permitted to be given by one Party to the other under this Agreement will be in writing and
will be sufficient if made by: (i) personal delivery; (ii) a commercial or overnight delivery
service with proof of delivery; or (iii) registered or certified mail, postage prepaid, return
receipt requested, to the Parties at the respective addresses set forth above or to such other
person or address as the Party to receive the notice has designated by notice to the other
Party. Notices shall be deemed given upon receipt or refusal of delivery.

	I.	 	Press Release. Upon execution of this Agreement, neither Party may issue any press release
or other public statement regarding the execution of this Agreement without the prior written
approval of the other Party. Client acknowledges that PeopleSupport may refer to Client as a
customer in its customer lists for marketing purposes.

	J.	 	[INTENTIONALLY LEFT BLANK].

	K.	 	Entire Agreement and Integration. This Agreement, and the Exhibits and Attachments hereto
constitute the entire agreement between the Parties with respect to the subject matter of this
Agreement and supersede all prior agreements, discussions, proposals, representations or
warranties, whether written or oral on this subject matter. This Agreement, including any
SOWs, may not be modified except in writing signed by a duly authorized representative of the
Parties. References to “this Agreement” shall be construed to include applicable SOWs,
whether attached hereto as Exhibit A, or subsequently agreed upon by the parties and
referencing this Agreement.

	L.	 	Arbitration. Any disputes or claims arising out of or from this Agreement shall be finally
settled by binding arbitration in ***, in accordance with the then-current rules and
procedures of the American Arbitration Association. The arbitration shall be adjudicated by
one (1) arbitrator mutually designated by the Parties or appointed by the American Arbitration
Association if the parties fail to so designate an arbitrator. Judgment on the award rendered
by the arbitrator may be entered in any court of competent jurisdiction. The Parties agree
that, any provision of applicable law notwithstanding, they will not request, and the
arbitrator shall have no authority to award punitive or exemplary damages against any Party or
any other relief in excess of the limitations set forth herein. Without limiting the
generality of this Section, any Party may seek temporary or preliminary injunctive relief in a
court of competent jurisdiction, but any request for permanent injunctive relief shall be
resolved by arbitration according to this Section. The arbitrator shall have the authority to
issue injunctive relief, including a permanent or final injunction, and such orders may be
confirmed as enforceable judgments in a court of competent jurisdiction. The arbitrator’s
award shall adhere to the plain meaning of this Agreement and to applicable law, and shall be
supported by written findings of fact and conclusions of law.

	M.	 	Attorneys’ Fees. In any dispute arising under this Agreement each Party will bear its own
attorneys’ fees and other expenses associated with the resolution of the dispute; provided,
however, that PeopleSupport will be entitled to recover from the Client all reasonable
attorneys’ fees and other reasonable expenses associated with the collection from Client of
delinquent undisputed charges.

	N.	 	Counterparts. This Agreement may be signed in multiple counterparts, each of which will be
considered an original, and all of which will be considered one and the same document. This
Agreement may be executed by facsimile signature.

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

PEOPLESUPPORT, INC. AND VONAGE HOLDINGS CORP. CONFIDENTIAL

7

 

	 	 	 
	ACCEPTED BY:

	 	ACCEPTED BY:
	 
	 	 
	Vonage Holdings Corp. (“Client”)

	 	PeopleSupport, Inc. (“PeopleSupport”)
	 
	 	 
	***

	 	By: \s\ Caroline Rook
	 

	 	Name: Caroline Rook
	 

	 	Title: CFO
	 

	 	Date: April 15, 2004

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

PEOPLESUPPORT, INC. AND VONAGE HOLDINGS CORP. CONFIDENTIAL

8

 

EXHIBIT A

Statement of Work No. 1

PEOPLESUPPORT, INC. AND VONAGE HOLDINGS CORP. CONFIDENTIAL

9

 

*   CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED
AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION.

Statement of Work No. 1

 for 

Vonage

Inbound Voice Support

Presented by

April 9, 2004

ver 1.0

 

 

			
	
	 	

Proprietary Statement

Intended for Vonage

This Statement of Work is attached to, and made a part of, the Master
Services Agreement (the “Agreement”), executed as of April 9, 2004, by and
between PeopleSupport, Inc. (“PeopleSupport”) and Vonage Holdings Corp.
(“Vonage” or “Client”). This document and any communications between
PeopleSupport and Vonage related thereto are considered highly confidential
for purposes of Section 7 of the Agreement.

PeopleSupport, Inc.

	 	 	 
	Contact:

	 	***
	 

	 	Director of Sales
	Corporate

	 	1100 Glendon Avenue
	Address:

	 	Suite 1250
	 

	 	Los Angeles, CA 90024
	Telephone:

	 	***
	Mobile

	 	***
	Fax:

	 	(310) 824-6299
	Email:

	 	***@PeopleSupport.com

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any
portion of the contents of these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 2

 

 

			
	
	 	

Table of Contents

	 	 	 	 	 
	1 INTRODUCTION
	 	 	4	 
	 
	 	 	 	 
	2 SOLUTION OVERVIEW
	 	 	5	 
	 
	 	 	 	 
	2.1 Inbound Voice Support Processes
	 	 	 5	 
	2.2 Support Escalation Process
	 	 	 5	 
	2.3 Performance Objectives
	 	 	 5	 
	2.4 Volume Forecasting and Service Level Agreement
	 	 	 6	 
	2.5 Adjustment to Forecasts and Ramp-Up Processes
	 	 	 7	 
	2.6 PeopleSupport Operational Capacity Planning
	 	 	 9	 
	 
	 	 	 	 
	3 TRAINING
	 	 	10	 
	 
	 	 	 	 
	3.1 Training Approach
	 	 	10	 
	3.2 Ongoing Training after Live Date
	 	 	10	 
	3.3 Staffing Profile and Training Timelines
	 	 	11	 
	 
	 	 	 	 
	4 QUALITY ASSURANCE
	 	 	13	 
	 
	 	 	 	 
	4.1 Quality Assurance Review Process
	 	 	13	 
	 
	 	 	 	 
	5 TECHNOLOGY
	 	 	14	 
	 
	 	 	 	 
	5.1 Technology Architecture and Specifications
	 	 	14	 
	5.2 Voice Technology Support
	 	 	15	 
	5.3 Data Connectivity
	 	 	16	 
	5.4 Client Applications
	 	 	16	 
	5.5 Reporting
	 	 	17	 
	5.6 Escalation of Technology issues
	 	 	17	 
	 
	 	 	 	 
	6 TIMELINE, RESOURCES AND ASSUMPTION
	 	 	18	 
	 
	 	 	 	 
	6.1 Client Project Team
	 	 	18	 
	6.2 Assumptions
	 	 	19	 
	6.3 Change Management and Change Control
	 	 	19	 
	 
	 	 	 	 
	APPENDIX A — PRICING
	 	 	22	 
	 
	 	 	 	 
	APPENDIX B — TECHNICAL ESCALATION PROCEDURES
	 	 	25	 

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any
portion of the contents of these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 3

 

 

			
	
	 	

1 Introduction

This Statement of Work No. 1 (“SOW No. 1”), dated as of April 9, 2004 describes the Voice
services (“Services”) that PeopleSupport, Inc. (“PeopleSupport”) will provide to Vonage (“Client”).
This SOW is entered into in connection with that certain Master Services Agreement between
PeopleSupport and Client dated as of April 9, 2004 (the “Agreement”). This SOW supercedes all
prior functional and technical understandings, whether written or oral, between PeopleSupport and
Client regarding the matters addressed herein, including all prior SOWs and change orders. All
capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to
them in the Agreement.

Overview of PeopleSupport Services

PeopleSupport will provide inbound Voice response for sales support services. Voice support will
be provided for Client’s customer calls routed to PeopleSupport phone system.

Program Overview

Voice Operations

	 	 	 
	Operating Model

	 	Outsourced
	 
	 	 
	Solutions and Services 

	 	Inbound Voice Support
	 
	 	 
	 

	 	Voice Support: 
	PeopleSupport Support Hours

	 	***
	 
	 	 
	 

	 	Voice Support: 
	 

	 	• 1) ***  of calls Answered Within ***
	 

	 	• 2  ***  abandonment rate
	 

	 	• 3) ***  scores to meet or ***
	 

	 	• 4) *** ratio of ***  or ***  or ***  at least ***
	Service Level Agreements

	 	• 5) ***  on peoplesupport ***  to ***  or ***
	 

	 	• 6) network and technical uptime of *** on an ***  basis
	 

	 	• 7) ***  rate not to exceed *** annualy
	 

	 	• 8) Average *** less than ***
	 

	 	• 9) ***  rate of ***  or higher
	 
	 	 
	Client Operating Hours

	 	24/7
	 
	 	 
	Languages Supported

	 	English
	 
	 	 
	Client Application Platforms

	 	Client Provided Web Applications:
	 

	 	• ***

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of
these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 4

 

 

			
	
	 	

2 Solution Overview

PeopleSupport will provide Voice support services for the Client’s Sales Services.
PeopleSupport eReps will assist customers with the following business programs:

	 	 	 	 	 	 	 
	Program	 	Systems Used	 	Tasks	 	Touch Points
	CRM

	 	Ø ***
	 	Ø ***
	 	Ø Inbound Voice

2.1 Inbound Voice Support Processes

PeopleSupport will provide Inbound Voice Support response for Client. Inbound voice support will
consist of live voice response to customer general and sales calls.

Client and PeopleSupport agree on the following Inbound Voice Support processes:

1. ***

2. *** .

3. *** .

4. *** .

5. *** .

The above processes are required voice support processes. Changes to these processing requirements
will be subject to a documented change order.

2.2 Support Escalation Process

The training material provided by Client will enable PeopleSupport to handle all calls routed to
PeopleSupport without escalating them to Client’s facility. However, there may be situations where
PeopleSupport eReps will need to transfer calls to Client’s center. In such circumstances, the
issue will be assigned to the appropriate internal Client department who will resolve the issue.
Client agrees to provide PeopleSupport a toll free number to be used for all transfers. Detailed
Escalation Process is documented in the training manual.

2.3 Performance Objectives

Client and PeopleSupport agree on the following performance goals for all programs. Client
represents *** . PeopleSupport may request and Client will provide documentation, if
such documentation is (1) in Client’s possession
without analysis and manipulation or (2) reasonably available to Client and without substantial
additional cost to Client, that supports the representations made in (i) and (ii) above. Should
Client require PeopleSupport to significantly change the processes currently

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these
materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 5

 

 

			
	
	 	

in place require PeopleSupport to provide a different type of support, Client and PeopleSupport may
mutually agree to an appropriate set of new service levels.

Ø Inbound Voice SLAs Measured on a Monthly Basis except as noted

	•	 	 1) ***  of calls Answered Within *** of calls ***
	 
	•	 	 2) *** abandonment Rate
	 
	•	 	 3) ***  scores to ***  or
***  and at ***
	 
	•	 	 4) ***  ratio of at least ***  and
***  at least ***  other ***
	 
	•	 	 5) ***  on peoplesupport ***  to
***
	 
	•	 	 6) network and technical uptime of ***  measured
***
	 
	•	 	 7) ***  rate not to exceed *** 
annually
	 
	•	 	 8) Average ***  less than ***

	 
	•	 	 9) ***  rate of ***  or higher

PeopleSupport is not responsible for delays in meeting the service levels to the extent arising
from any Client provided telecommunication, software applications, materials, equipments or Client
operational delays.

Ramp-up period estimate is *** . PeopleSupport will be on an all-reasonable-efforts basis
to meet the program goal and service levels during the ramp-up period and the first ***
of any subsequent ramp-up initiatives set forth in the mutually agreed upon Ramp up Plan Change
Order for service level requirements 3 through 5, and 8. For all other service level requirements,
PeopleSupport will be on *** for the first *** of the program

Definitions

Abandonment Rate: Total Calls Abandoned/Total Call Received

Total Calls Abandoned: The total number of calls disconnected while in queue with a queue time
(including the time of any announcements) greater than the threshold value. The threshold value is
the greater of *** .

Quality Score: measured by client internal quality program to be mutually agreed to by
PeopleSupport and Client and or a third party scoring service. Should Client utilize an internal
quality program, Client agrees to conduct regular calibration sessions with PeopleSupport’s QA team
to ensure quality measurements are in agreement.

Sales Retention: Specific measurement criteria to be defined by Client and reasonably acceptable
to PeopleSupport. *** . PeopleSupport will be provided similar data as the client uses.

Network and Technical Uptime: On an annual basis, the percentage of time PeopleSupport’s technical
infrastructure is not experiencing an outage that prevents PeopleSupport from providing support to
Client, excluding scheduled maintenance.

Attrition Rate: The total number of PeopleSupport eReps assigned Client to leave PeopleSupport
(excluding mutually agreed planned ramp downs), divided by the peak number of reps assigned to
Client. Internal movements and promotions within Client’s account are not included as part of
attrition. Peoplesupport attests that its current annual attrition rate averages between
*** and *** %

Occupancy Rate: Voice Handle Time plus Voice Available Time divided by ACD Billable Time minus Aux
Training Time.

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of
these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 6

 

 

			
	
	 	

2.4 Volume Forecasting and Service Level Agreement

In order for PeopleSupport to properly staff the Client’s account, Client agrees to provide
PeopleSupport with a *** , , of the number of Voice sessions Client will deliver to
PeopleSupport for each program during that *** period. All such forecasts will be deemed
Client’s confidential information for purposes of Section 7 of the Agreement. Initially, the
forecast submission is considered locked for *** period and subsequent ***
submissions will be locked for that new *** in accordance with Section 2.5 below. For
example, on *** , *** , Client would submit a forecast for weeks beginning
*** , and the forecast would be considered locked for weeks beginning *** .
PeopleSupport will develop a capacity plan that will allow the forecast to be increased or
decreased by Client up to *** for any subsequent *** forecast without requiring
additional ramp up / ramp down. Should Client fail to deliver a forecast for a given
*** , the *** of the last forecast shall be extended forward *** and
be considered locked. Should Clients volume require staffing in excess of *** , the
*** forecast may be increased and decreased by no more than *** per
*** .

Client must receive written confirmation of receipt of such forecast from its PeopleSupport before
the forecast is deemed accepted by PeopleSupport; provided that if PeopleSupport does not respond
to such forecast within *** , such forecast will be deemed received and accepted.
PeopleSupport shall not withhold acceptance upon receipt. PeopleSupport agrees to service, in each
calendar month, that number of support sessions equal to the respective Support Target for such
month, but may, in its discretion, service additional support sessions.
PeopleSupport shall not be obligated to meet the agreed upon performance objectives and service
levels numbered *** and any *** specifically related to *** in the
event that, and during such times as, the actual volume of sessions received by PeopleSupport is
more than *** over the respective forecasted increments for such point of contact. Should
Clients volume require staffing in excess of *** eReps, PeopleSupport shall not be
obligated to meet the agreed upon performance objectives and service levels numbered ***
and any *** specifically related to *** in the event that, and during such
times as, the actual volume of sessions received by PeopleSupport is more than *** All
other service level objectives need to be met and maintained at all times.

PeopleSupport will work with Client to develop a daily volume distribution, broken down into hourly
intervals, based on Client forecasts and historical data. PeopleSupport will submit such plan,
together with a statement of associated FTE staffing levels, to Client at least *** days
prior to the anticipated date for *** locked-in forecast for Client’s approval and Client
shall give its reasonable approval or disagreement at least *** days prior to the
anticipated *** lock-in forecast date. If Client disagrees with PeopleSupport’s plan and
FTE staffing levels, then the parties will negotiate in good faith and mutually agree upon the
locked-in forecast and FTE staffing levels at least *** days prior to the anticipated
date for the *** locked-in forecast so that PeopleSupport may staff for such period
(thus, in the above example, PeopleSupport would submit its plan by *** , Client would
give its approval or disagreement by *** and the parties would negotiate to agree on a
plan and staffing levels by *** . Upon Client’s approval or mutual agreement,
PeopleSupport’s daily volume distribution will be incorporated with Client’s forecast to develop a
*** capacity plan for the hourly increments and associated FTE levels. ***

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these
materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 7

 

 

			
	
	 	

2.5 Adjustment to Forecasts and Ramp-Up Processes

PeopleSupport will develop a capacity plan such that the respective Support Target may be increased
or decreased by Client by up to *** from *** ( *** in advance)
without requiring additional ramp-up / ramp-down; provided that the number of eReps providing
Services is *** or less. If the number of eReps providing Services is greater than
*** , then such increase or decrease, as the case may be, will be *** instead of
*** from *** to *** . The Support Targets for a *** become
locked-in *** prior to the start of such *** . All adjustments made to the
Support Targets must be delivered to PeopleSupport Account Manager.

2.5.1 Substantial Volume Increases

If Client requires a volume increase in the number of contacts supported by PeopleSupport
(i.e., *** ) (a “Substantial Volume Increase”), a mutually agreed upon ramp up period will
be planned:

	 	a)	 	To facilitate the appropriate collection of human and technical resources to handle a
Substantial Volume Increase, Client must provide reasonable notice to PeopleSupport, but in
no case less than *** written notice before the start of the Substantial Volume
Increase. The proposed Substantial Volume Increase requirements shall be reasonable under
the circumstances and the available resources and technical infrastructure.
	 
	 	b)	 	PeopleSupport will present Client with a Change Order outlining a detailed capacity
ramp up plan (“Ramp up Plan”) for Client’s approval. Client must approve the capacity plan
and the terms of the Change Order before PeopleSupport commences with the ramp up.
	 
	 	c)	 	Performance goals shall be as defined in section 2.3 for a ramp-up period.

2.5.2 Volume Decreases

Notwithstanding Section 2.4 above and in the event of a *** . Client shall provide
PeopleSupport with written notice of a *** in order for PeopleSupport to determine the
initial number of FTEs to be used *** .

2.5.3 Forecasts for Special Promotions and Advertising

Client will provide PeopleSupport with notice of and forecasts related to all special media
and program promotions (including, but not limited to, radio, television, direct mail, Internet and
other media) within a reasonable amount of
time before release of the promotion so that PeopleSupport can make appropriate staffing or other
adjustments. All such notices and forecasts will be deemed Client’s confidential information for
purposes of Section 7 of the Agreement. PeopleSupport shall not be obligated to meet performance
objectives in the event that, and during such times as, the actual volume of sessions received by
PeopleSupport is more than twenty *** over the forecast; provided that if the number of
eRep providing Services is *** or less and if the number of eReps providing Services to
Client is greater than *** then PeopleSupport shall not be obligated to meet performance
objectives in the event

 

			
	*	 	 CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these
materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 8

 

 

			
	
	 	

that, and during such times as, the actual volume of sessions received by PeopleSupport is more
than *** *** over the forecasted increments. However, PeopleSupport shall make ***
to meet performance goal(s) for the volume that is within the lock-in forecast level.

2.6 PeopleSupport Operational Capacity Planning

PeopleSupport will work closely with Client’s Work Force Management team to plan capacity, and to
develop operational plans. Based on the volume forecasts provided by Client in the ***
Support Forecast, PeopleSupport will provide Client with a monthly capacity forecast
reflecting the number of eReps required to handle the forecasted volume of contacts in accordance
with its performance objectives and service levels (“Monthly Capacity Plan”). The Monthly Capacity
Plan will factor in PeopleSupport’s analysis of actual contact volumes, historical performance,
existing and new-hire resources and special circumstances (holidays, seasonality and attrition
factors).

 

			
	*	 	CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents
of these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 9

 

 

			
	
	 	

3 Training

The training phase of the outsourcing program is crucial to PeopleSupport’s ability to provide
Client with quality service. In this section, our approach, initial and ramp-up training process
and the on-going program updates or changes training.

3.1 Training Approach

Client and PeopleSupport will jointly participate in the training needs analysis process with
members from both teams to identify learning objectives and determine the scope of the training
effort. Peoplesupport will certify all agents have passed a client approved curriculum.

Client will make available all existing training and research documentation, training materials,
and the knowledge base to PeopleSupport. All such materials and documentation will be deemed
Client’s confidential information for purposes of Section 7 of the Agreement. Client will provide
training materials and related documentation sufficient for PeopleSupport to conduct a successful
training program. If necessary, and to assist in meeting Service Levels, PeopleSupport may update
the Client training material or prepare a new course program with Client approval via the change
order process.

PeopleSupport will develop a training program for Client with the following capabilities:

	•	 	Utilize the Client trainers and facility for the Train-the-Trainer session.
	 
	•	 	Provide instructors with extensive background in customer service, technical support, and sales, as well as stand up
classroom training experience.
	 
	•	 	Provide customer service, sales and communications training, Client product/program training and pre-certification of
agents prior to performing support for Client.
	 
	•	 	Establish a training and QA structure that supports Client’s program requirements.
	 
	•	 	Create a separate training environment that resembles the live Client environment, including individual workstations
equipped with Client’s applications.

All new eReps receive a PeopleSupport New Hire Orientation and the Client-specific training. After
completion of the prescribed training, eReps will undergo a Nesting Period where Team Supervisors
and trainers can observe and monitor such eReps closely before releasing them onto the production
floor. The Nesting Period is estimated to be *** days in duration during which they will
be handling a reasonable number of calls. The Client specific training and Nesting Period shall be
billed at a *** rate as defined in Appendix A of this SOW.

3.2 Ongoing Training after Live Date

Increases in the volume of services provided and/or significant changes to Client’s
policies/procedures, products, or service offerings will require post-implementation training. A
need analysis will be conducted to determine if any course development material must be prepared,
and to scope out how long the training should take so that PeopleSupport can appropriately schedule
the training. In order to meet its goal of providing the highest level of quality, PeopleSupport
will recommend training updates when deemed necessary. Client must provide PeopleSupport with all
relevant ongoing training materials within the same timeframe

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for any
purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 10

 

 

			
	
	 	

that it provides its own internal centers. PeopleSupport will provide all new hires with
client approved standard New Hire Orientation and training. Reasons for needing
post-implementation training may, but do not necessarily, include the following:

	 	 	 	 	 
	 ̈ ***

	 	 ̈ ***
	 	 ̈ ***
	 ̈ ***

	 	 ̈ ***
	 	 ̈ ***

Client may request PeopleSupport to provide additional training on updated material and other
newly introduced Client system.

Should PeopleSupport and Client mutually agree that ongoing classroom training is required,
PeopleSupport will prepare a change order documenting the training required, time period for the
training, and the cost. PeopleSupport will not begin any classroom training without written
approval from Client. Normal product update information will be handled as part of the normal
day-to-day operations and will not require a change order.

Client will be responsible for all of Client *** of PeopleSupport personnel for this activity. ***

3.3 Staffing Profile and Training Timelines

The PeopleSupport eReps staffed on Client’s account will posses general sales skills and have
technical background or demonstrated technical skills. PeopleSupport will determine that eReps
staffed on Client’s account will meet the following qualifications :

	•	 	***
	 
	•	 	*** .
	 
	•	 	***
	 
	•	 	***
	 
	•	 	***
	 
	•	 	***

Implementation timelines may be reassessed or revised if the scope of the project changes
after Client and PeopleSupport mutually agree upon the learning objectives and training plan and/or
if the Client deliverable timelines are not met.

Here is a proposed timeline for the training dates and program ramp-up phases:

	 	 	 	 	 	 	 	 	 	 	 
	***

	 	***
	 	***
	 	***
	 	***
	 	***
	 
	 	 	 	 	 	 	 	 	 	 
	***

	 	***
	 	***
	 	***
	 	***
	 	***
	 
	 	 	 	 	 	 	 	 	 	 
	***

	 	***
	 	***
	 	***
	 	***
	 	***
	 
	 	 	 	 	 	 	 	 	 	 
	***

	 	***
	 	***
	 	***
	 	***
	 	***

Based on Client’s requirements (initial volume and turnaround SLA), PeopleSupport will
initially

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for any
purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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train ***.

PeopleSupport will *** for PeopleSupport’s personnel during the initial *** .

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for any
purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 12

 

 

			
	
	 	

4 Quality Assurance

PeopleSupport will provide a comprehensive quality management and assurance process with the
following components:

	•	 	A Quality Assurance program designed for the Client’s program. Program format will be mutually agreed upon.

	•	 	A dedicated Quality Assurance (QA) team who together with an eRep’s supervisor will conduct QA monitoring.

	•	 	Weekly voice coaching calibrations between PeopleSupport QA/Operations Team and the Client.

	•	 	The frequency of monitoring will be commensurate with individual eRep performance scores.

	•	 	Development of action plan for agents/teams that fall below the Client QA standard.

	•	 	A “Best Practices” Training manual

	•	 	A program and eRep score card providing metrics and performance against goals

PeopleSupport utilizes and maintains an in-house quality assurance manual. The quality assurance
manual is used to document internal and custom client processes and procedures. PeopleSupport and
Client will work together to regularly update the QA manual based on the close loop feedback
mechanism and through the Calibration Sessions. *** . Quality goals will be established
within *** business days after Live Date of any new program and reviewed monthly.
PeopleSupport agrees to maintain a quality monitoring system.

4.1 Quality Assurance Review Process

Quality Assurance reviewing will be conducted by the QA department and the Operation Supervisors or
Operation Shift Lead. Each month the QA Analyst will have a target number of sessions to complete.
The Analyst may conduct a review through the use of voice recorded sessions.

During a review session, the eRep’s voice session is either *** or through *** session. Sessions are analyzed and scored by QA Analyst on the QA Score Sheet. After this
process, the QA Analyst meets with the eRep to deliver targeted feedback on his/her performance and
provides coaching, if necessary. QA Score Sheet results detailing individual and team performance
are reported to the Supervisors in the weekly team reports. Trending analysis will be provided to
Client on a weekly basis. Individual and detailed information will be provided at the Client’s
request.

In addition, Operation Supervisors review a sample of sessions on a weekly basis. This review
process, is similar to the QA process and is documented on the same score sheet. The feedback is
given to the eRep either immediately or during a later review session. The Supervisor provides
positive feedback or any necessary coaching. If remedial action is required, the Production
Supervisor may recommend coaching from a Subject Matter Expert, listening to other eReps during
sessions, or providing additional focused training.

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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5 Technology

5.1 Technology Architecture and Specifications

This section outlines the technical requirements for the integration of systems and technologies in
support of Client’s operation at PeopleSupport.

The following diagram illustrates the agreed voice and data connectivity architecture between
Client and PeopleSupport facilities:

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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***

5.2 Voice Technology Support

***.

***.

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 15

 

 

			
	
	 	

***

PeopleSupport will provide and support the following VDNs and routing requirements to support
Client:

	 	 	 	 	 
	Function Name	 	Toll Free Number	 	Routing
	***

	 	***
	 	***
	 
	 	 	 	 
	***

	 	***
	 	***

***.

***.

***.

***.

***.

5.3 Data Connectivity

Client’s Sales Tool application is accessed over the Public Internet.

5.4 Client Applications

PeopleSupport utilizes the following applications supplied by Client to provide customer service
for Client’s customers:

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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1. *** Tool – Web based *** application.

5.5 Reporting

PeopleSupport will provide *** secure web site containing the *** portal.
Client may access and download all of its reports for its account *** . All reports are
***. If Client wishes to have reports generated on information not included in the
PeopleSupport standard reporting package, PeopleSupport can provide custom reporting. The
requirements, cost, and time frame required for development will be determined by the
Implementation Project Manager and will be submitted to Client in writing for approval prior to
commencement of development. This would include integration of reports with Client’s sales data.

Information available on the Client Portal will be maintained on the Portal for the following
periods of time: *** . It is Client’s responsibility to keep and store such reports for
future reference following such periods. For a period of *** following such periods,
PeopleSupport will keep raw data only.

Interval Call Management can be monitored via *** portal and real time volumes can be
viewed from *** . Client will be able to retrieve hourly call volume statistics from
*** portal. In addition, Client can access the PeopleSupport CMS system to observe all
Client data available through *** including but not limited to skills, VDNS and agents.
Subject to this Section 5.5, Client will have the ability to download and view information and
historical data in accordance with time frames outlined in Appendix C to this SOW #1.
PeopleSupport will provide Client with software license copy for *** at the price set
forth in Appendix A. As set forth in Appendix A, monthly invoices will be calculated using reports
generated by PeopleSupport on it’s *** using data from the phone switch reporting system.
Such reports will be available for Client to review on *** site.

5.6 Escalation of Technology issues

PeopleSupport and Client agree to follow the Technical Escalation Procedures documented hereto as
Appendix B for any technical issues that may arise affecting Client’s customer service operations.

 

* CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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6 Timeline, Resources and Assumption

Within *** of execution of this SOW and the Agreement, PeopleSupport will prepare
and deliver to Client a project plan (the “Project Plan”) that contains the critical path dates
that each party must meet in order for PeopleSupport to adhere to the implementation deadlines.
PeopleSupport and Client will mutually agree upon the Live Date set forth in the Project Plan.
Client will make all reasonable efforts to cooperate and work with PeopleSupport to deliver any
Client dependant materials delineated in the agreed upon Project Plan. To the extent that Client
fails to meet a critical path date that impacts PeopleSupport’s work, PeopleSupport reserves the
right to reassess and reasonably adjust all dates contained within the Project Plan to the extent
necessary to reflect Client’s failure.

	 	 	 	 	 	 	 
	***

	 	 	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
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	***

	 	***
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	***

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	***

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	 	***
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	***

	 	***
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	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***

6.1 Client Project Team

In support of Client’s program, PeopleSupport will conduct conference calls and request information
from a Client-appointed single point of contact and other Client personnel. Client agrees to:

	 	•	 	Client and PeopleSupport will make appropriate personnel available to each other on a
timely basis, including a single point of contact with authority to make decisions, discuss
and resolve day-to-day issues, to assist in completing deliverables and for coordinating
additional resources and sign-off as required.
	 
	 	•	 	Client and PeopleSupport will assign a technical resource to the project to oversee the
connectivity, application access and voice/data network integration projects.

Client and PeopleSupport personnel will accept responsibility for their assigned tasks and will
complete them within the specified schedule. Any delays caused by the unavailability of Client or

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 18

 

 

			
	
	 	

Peoplesupport resources or completion of requests may adversely affect the project schedule,
and PeopleSupport’s adherence to Service Levels and Performance Objectives.

6.2 Assumptions

     • *** .

     • *** .

     • *** .

6.3 Change Management and Change Control

PeopleSupport and Client recognize that the dynamic nature of Client’s business model may
necessitate that material changes be made to processes outlined herein

Should Client request PeopleSupport to make material changes to the processes defined in this SOW,
PeopleSupport will prepare a change order for Client’s review and approval before implementing the
change. The change order will include the costs, if any, and the proposed timeline for
implementing the change. All costs will be at the rates defined in this SOW unless other wise
mutually agreed by Client and PeopleSupport.

Items that would require a change order include, but are not limited to the following:

	•	 	Changes to the technical architecture defined in this SOW

	•	 	Custom report development outside of initial report requirements

	•	 	Telecom programming outside of what is defined in this SOW

	•	 	Significant operation process changes

	•	 	Support for new touchpoints

	•	 	Additional training required

7.0 Additional Requirements

	•	 	PeopleSupport provides *** and call monitoring capability for all of its locations used to provide
Services to Client. This monitoring is password protected and can be conducted anytime and from anywhere
without the need for prior arrangement with PeopleSupport. Client will be provided with the ability for live
call monitoring capability by dialing into PeopleSupport’s PBXs. PeopleSupport represents and
warrants that such call monitoring capability and PeopleSupport’s provision of it comply with all applicable
laws in all material respects and that PeopleSupport has obtained, or will obtain prior to the use of such
capability, any requisite consent to such monitoring.

	•	 	PeopleSupport will review all agent and supervisor incentive programs provided by PeopleSupport with client

	•	 	Agents are to be *** to Client, subject to Minimum Monthly Fees payment by Client

	•	 	Client has the right to review and audit once a year all documents and records of PeopleSupport directly
related to Services rendered under this agreement or reasonably requested by Client for purposes of
determining PeopleSupport’s meeting of service level

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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objectives and compliance with the other provisions of this SOW, with reasonable prior
written notice to PeopleSupport; provided that Client will not interfere with PeopleSupport’s
operations in connection with the audit beyond the reasonable use of PeopleSupport personnel and
resources in retrieving and compiling such documents and records. PeopleSupport will provide all
supporting documentation related to billing and SLA’s on a monthly basis as requested, if (1) in
PeopleSupport’s possession without analysis and manipulation or (2) reasonably available to
PeopleSupport and without substantial additional cost to PeopleSupport.

	•	 	*** .
	 
	•	 	PeopleSupport will provide the following computer and network systems recovery mechanisms:

*** .

*** .

*** .

*** .

	•	 	PeopleSupport’s standard reports are described in Appendix C attached hereto and are included at no additional charge. The
parties will use the Change Order process to modify Appendix C as necessary.

	•	 	At a minimum, the following ratios will be maintained for the clients account — *** .

	•	 	PeopleSupport voice equipment utilizes *** technologies. Facilities in the Philippine are equipped with *** .

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 20

 

 

			
	
	 	

IN WITNESS WHEREOF, the Parties have caused their duly authorized representatives to execute
and meet the deliverables outlined in this SOW.

	 	 	 
	Vonage
 

	 	 
	 
	 	 
	***
	 	 
	 
	 	 
	 

	 	 
	Signature
	 	 
	***
	 	 
	 
	 	 
	 

	 	 
	Print Name
	 	 
	Senior Vice President
	 	 
	 
	 	 
	 

Title

	 	 
	4/9/04
	 	 
	 
	 	 
	 

	 	 
	Date
	 	 
	 
	 	 
	PeopleSupport, Inc.
	 	 
	 

	 	 
	 
	 	 
	\s\ Caroline Rook
 

	 	 
	 
	 	 
	Signature
	 	 
	Caroline Rook
	 	 
	 
	 	 
	 

	 	 
	Print Name
	 	 
	CFO
	 	 
	 
	 	 
	 	 	 
	Title
	 	 
	4/15/04
	 	 
	 
	 	 
	 

	 	 
	Date
	 	 

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 21

 

 

			
	
	 	

Appendix A — Pricing

	 	 	 
	SERVICE	 	PRICE
	LIVE VOICE SERVICE, Phone
	 	 
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 22

 

 

			
	
	 	

	 	 	 
	***
	 	 
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***
	 	 
	 
	 	 
	 

	 	***
	 
	 	 
	 

	 	***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 23

 

 

			
	
	 	

	 	 	 
	***
	 	 
	 
	 	 
	 

	 	***
	 
	 	 
	***
	 	 
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***
	 	 
	 
	 	 
	***

	 	***

	 	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***
	 
	 	 
	***

	 	***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 24

 

 

			
	
	 	

Appendix B — Technical Escalation Procedures

Primary Technical Contacts

PeopleSupport and Client have provided the following designated contacts that are authorized to
respond to technical emergencies and escalations:

Client will designate the escalation contact within 30 days of execution of this SOW.

Client Technical Escalation Information

	 	 	 	 	 	 	 	 	 	 	 	 	 
	***
	 	***
	 	***
	 	***
	 	***
	 	***
	 	***

***

	 	 	 	 	 	 	 	 	 	 	 	 	 
	***
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	 	***
	 	***
	 	***
	 	***
	***
	 	***
	 	***
	 	***
	 	***
	 	***
	 	***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport, Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 25

 

 

			
	 	 	 
	
	 	

Purpose and Scope

PeopleSupport has established a set of standard Client Escalation Procedures available to all
clients. These escalation procedures are outlined below. PeopleSupport has made an effort to
address all operational aspects of providing continued service to clients. However, we recognize
that clients might require additional procedures unique to their operational needs. To address
these unique requirements outside of the standard escalation procedures, PeopleSupport can work
with each client to create customized business resumption and escalation procedures as needed.

This document serves as the standard PeopleSupport Client Escalation Procedure. This procedure
documents both Client and PeopleSupport responsibilities with regards to notification, ongoing
communication and correction of problems arising from an outage in services caused by systems and
internal operational elements under the control of PeopleSupport or caused by external elements
outside of the direct control of PeopleSupport. Specifics as to the PeopleSupport service (the
“Service”) to be provided to the Client are set forth in Client’s Statement of Work (SOW), which is
incorporated, signed into and made a part of the Agreement.

For reference, policies and procedures for system backup and recovery are stated in the
PeopleSupport Backup and Offsite Storage Policies document. The document can be obtained by
contacting your PeopleSupport Account Executive.

Event Notification

PeopleSupport shall provide initial notice to a designated Client representative by telephone,
e-mail, pager or comparable notification service *** PeopleSupport becoming aware of an
event that has caused or may cause an unscheduled outage or security breach problem. Client must
provide a valid pager number, fax number, voice mail or email address to PeopleSupport Helpdesk for
this purpose.

Client is solely responsible for providing accurate contact information for Client’s designated
point of contact. In the event Client first becomes aware of such outage or security breach event,
Client shall promptly provide initial notice to PeopleSupport via the assigned PeopleSupport
Helpdesk Number provided to Client. In the event of critical outages, status reports about the
event will continue on an hourly basis until either the event has been resolved or both
PeopleSupport and Client have determined a course of action that does not require continued
notification.

Client Technical Support

PeopleSupport will provide 7x24 customer service in support of Client’s customer service solution
via email, voice and voice mail for the purpose of these Client Escalation Procedures. The
customer service center can be used to log problem reports or request assistance with system usage.
Details of PeopleSupport and Client responsibility for the applications and services are outlined
in the SOW.

Monitoring Services

Monitoring Services refer to the ability of PeopleSupport to observe the performance and
availability of system, application and network components of the customer service solution in
real-time and identifying problems with such components that indicate an outage of services.

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

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PeopleSupport will perform 7x24 system-level monitoring, including polling of the hardware,
operating system and applications in order to detect abnormal system conditions. Key system
metrics monitored by PeopleSupport include:

	 	•	 	Hardware malfunctions
	 
	 	•	 	Server uptime
	 
	 	•	 	File System and Space utilization
	 
	 	•	 	CPU utilization
	 
	 	•	 	Memory utilization
	 
	 	•	 	Application Service availability
	 
	 	•	 	Wide-Area network uptime
	 
	 	•	 	Intrusion Detection and logging

For equipment under the control of PeopleSupport, PeopleSupport utilizes hardware sparing and
redundant equipment whenever possible to address malfunctioning equipment outages.

Problem Categories and Priorities

PeopleSupport has established a standard problem management procedure to identify, categorize and
track problems with the operational and hosted solutions under its direct control. Problems are
categorized and prioritized by order of importance to our Clients. PeopleSupport assigns a case
number to the problem when a client initiates a problem report by notifying the PeopleSupport
Helpdesk.

The PeopleSupport Helpdesk can be reached at numbers listed at the beginning of this document.

There are four categories of problems ranging from Emergency (Priority 1) to Assistance (Priority
4.)

	•	 	***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 27

 

 

			
	
	 	

***

Problem Resolution Response Times

The following table indicates PeopleSupport’s problem resolution goals. These resolution goals
apply to all problems related to systems and services under the direct control of PeopleSupport.
Problem resolution or workaround time commences after the problem has been identified and
reproduced by PeopleSupport. A Call Back procedure is followed by PeopleSupport to notify clients
affected by priority 1-3 problems. Clients must provide PeopleSupport Helpdesk with up to date
contact information and a preferred method of communication for all notifications. Client’s
primary contact shall have the authority to make decisions on behalf of Client to facilitate a
rapid resolution of all problems.

	 	 	 	 	 
	***

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	 	***
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	 	***
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In priority 1 and priority 2 cases that are as a result of PeopleSupport system problems,
PeopleSupport shall work around the clock until a resolution or workaround is reached.

All priority 1 problems are escalated internally as follows:

	 	 	 	 	 
	***

	 	***
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	***

	 	***
	 	***
	***

	 	***
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	***

	 	***
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	***

	 	***
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In priority 3 cases, PeopleSupport shall use commercially reasonable efforts to notify the
Client and resolve problems as quickly as is reasonably practical. Resolution to problems with
priority 4 depends on the scope and nature of the request (typically a programming or enhancement
request) and cannot be accurately forecasted. If a problem cannot be resolved permanently, a
temporary resolution will be implemented to the extent possible based on mutual agreement with
Client.

Escalation and Problem Resolution Procedures

	Ø	 	If the Source of the Problem is External to PeopleSupport

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 28

 

 

			
	
	 	

When there is a site and/or system problem that is external to PeopleSupport (such as
unavailability of the Client Web Site or back-end application system or tools):

	 	A)	 	Client shall notify the PeopleSupport Helpdesk immediately upon noticing the outage.
	 
	 	B)	 	PeopleSupport will “troubleshoot” the problem as appropriate to determine the impact of
the problem to systems and networks under the control of PeopleSupport. If the problem is
as a result of systems and facilities outside the control of PeopleSupport, Client shall
assign a designated resource to PeopleSupport to address the problem within a mutually
agreed upon timeframe.
	 
	 	C)	 	PeopleSupport shall contact Client’s designated support staff to inquire about the
problem periodically until the problem is resolved. Client’s designated support entity
must be listed at the beginning of this document.
	 
	 	D)	 	Client’s designated support staff shall respond to PeopleSupport inquiries with timely
updates in 60-minute intervals until the problem is resolved.
	 
	 	E)	 	In the event of a technical problem with Client’s call tracking system, email
management system, or any Client system directly used by PeopleSupport eReps, problems may
have a direct impact on PeopleSupport’s ability to meet the agreed upon service levels. In
such cases, PeopleSupport reserves the right to waive the agreed upon Service Level
measures or customer care as long as the problem remains unresolved by the Client.

	Ø	 	If the Source of the Problem is Internal to PeopleSupport

When there is a system or operational problem that is internal to PeopleSupport (such as
unavailability of the voice systems, applications or network access):

	 	A)	 	Client shall contact the PeopleSupport Helpdesk to report an exact detail of the
problem as soon as Client notices the problem. A PeopleSupport Helpdesk Analyst will
receive the call and open a ticket for the problem under an assigned priority. In the
event that an Analyst is not reachable, a voice mail or Page may be left for the on-call
support analyst at PeopleSupport. The Helpdesk shall return all voice mails and pages
within 30 minutes.
	 
	 	B)	 	PeopleSupport Analysts will “troubleshoot” the problem as appropriate to determine if
the problem is related to systems and networks under the control of PeopleSupport. If the
problem is as a result of systems and facilities under the control of PeopleSupport, a
designated resource from PeopleSupport will be assigned to address the problem.
	 
	 	C)	 	PeopleSupport Analyst shall notify Client’s designated point of contact immediately
upon noticing an outage.
	 
	 	D)	 	PeopleSupport Analyst shall provide Client with updates in 60-minute intervals until
the problem is resolved.
	 
	 	E)	 	In the event of a major catastrophic impact to Client’s operation at PeopleSupport
caused by systems under PeopleSupport’s direct control, PeopleSupport shall exercise the
Client’s agreed to Disaster Recovery plan to resolve the problem.

Scheduled Maintenance Policy

To maintain and enhance PeopleSupport’s hosted applications, network infrastructure and
communication systems, we have established a *** . The time periods below represent a
designated window of time that scheduled and routine maintenance activity may be planned without
prior notice. PeopleSupport will attempt to minimize the impact of the scheduled maintenances as
much as possible without impacting system’s future uptime and availability. Though the systems
might not become unavailable *** during the scheduled times listed below, clients should
assume and plan for momentary outages during these timeframes accordingly.

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

SOW No. 1

Page 29

 

 

			
	
	 	

	 	 	 	 	 
	***

	 	***
	 	***
	***

	 	***
	 	***
	***

	 	***
	 	***
	***

	 	***
	 	***

In addition to regularly scheduled maintenance, PeopleSupport may at times perform emergency
maintenance. Whenever possible, PeopleSupport shall make commercially reasonable efforts to
provide Client with *** notification of all scheduled maintenance procedures arising from
emergencies.

Modification of Escalation Procedures

Client acknowledges that from time to time, PeopleSupport may be required to modify terms and
conditions of this Client Escalation Procedure as required by third-party vendors. PeopleSupport
shall notify Client of any such Required Modification. Client shall have *** business
days to review such modification and notify PeopleSupport of its acceptance or rejection of same.
Failure to affirmatively reject shall be deemed an acceptance under this section.

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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Appendix C — REPORTING

PeopleSupport measures and monitors several key metrics on a continuous basis across all of
our contact centers. This enables us to ensure that we are managing and exceeding our Service
Level Agreements. These measures are reported in our Client Standard Reports on an hourly, daily,
weekly, and monthly. Our key metrics and their definitions are listed below.

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*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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***

 

*   CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

This document contains unpublished, confidential and proprietary information of PeopleSupport,
Inc. No disclosure, duplication or use of any portion of the contents of these materials, for
any purpose, may be made without the prior express written consent of PeopleSupport, Inc.

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                                                                   EXHIBIT 10.32

                          CARDIAC SCIENCE CORPORATION
                           STOCK OPTION GRANT NOTICE
                           2002 STOCK INCENTIVE PLAN

Cardiac Science Corporation (the "Company") hereby grants to Participant an
Option (the "Option") to purchase shares of the Company's Common Stock. The
Option is subject to all the terms and conditions set forth in this Stock
Option Grant Notice (this "Grant Notice"), in the Stock Option Agreement, the
Plan Summary and the Company's 2002 Stock Incentive Plan (the "Plan"), which
are available on the web at www.wealthviews.com/CSC or from the current
administrator of the Plan and are incorporated into this Grant Notice in their
entirety.

<TABLE>
<S>                                   <C>
PARTICIPANT:                          __________________________________________

GRANT DATE:                           __________________________________________

VESTING COMMENCEMENT DATE:            __________________________________________

NUMBER OF SHARES SUBJECT TO OPTION:   __________________________________________

EXERCISE PRICE (PER SHARE):           __________________________________________

OPTION EXPIRATION DATE:               _____________________________ (subject to
                                      earlier termination in accordance with the
                                      terms of the Plan and the Stock Option
                                      Agreement) _______________________________

TYPE OF OPTION:                       [ ] Incentive Stock Option*
                                      [ ] Nonqualified Stock Option

VESTING AND EXERCISABILITY SCHEDULE:  __________________________________________
</TABLE>

ADDITIONAL TERMS/ACKNOWLEDGEMENT: The undersigned Participant acknowledges
receipt of, and understands and agrees to, this Grant Notice, the Stock Option
Agreement, the Plan Summary and the Plan. The Stock Option Agreement, Plan
Summary, and Plan are available on the Web at www.wealthviews.com/CSC or from
the current administrator of the Plan. Participant further acknowledges that as
of the Grant Date, this Grant Notice, the Stock Option Agreement and the Plan
set forth the entire understanding between Participant and the Company regarding
the Option and supersede all prior oral and written agreements on the subject.

Cardiac Science Corporation                             PARTICIPANT

By:
    ---------------------------------   ----------------------------------------
Its:                                                    Signature
     --------------------------------

                                        Date:
                                              ----------------------------------
ATTACHMENTS:                            Address:
                                                 -------------------------------
1.   Stock Option Agreement
2.   2002 Stock Incentive Plan          ----------------------------------------
3.   Plan Summary                       Taxpayer ID:
                                                     ---------------------------

----------
*    See Sections 3 and 4 of the Stock Option Agreement.

<PAGE>

                           CARDIAC SCIENCE CORPORATION
                            2002 STOCK INCENTIVE PLAN
                             STOCK OPTION AGREEMENT

Pursuant to your Stock Option Grant Notice (the "Grant Notice") and this Stock
Option Agreement, Cardiac Science Corporation has granted you an Option under
its 2002 Stock Incentive Plan (the "Plan") to purchase the number of shares of
the Company's Common Stock indicated in your Grant Notice (the "Shares") at the
exercise price indicated in your Grant Notice. Capitalized terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

The details of the Option are as follows:

1. VESTING AND EXERCISABILITY. Subject to the limitations contained herein, the
Option will vest and become exercisable as provided in your Grant Notice,
provided that vesting will cease upon the termination of your employment or
service relationship with the Company or a Related Company and the unvested
portion of the Option will terminate.

2. SECURITIES LAW COMPLIANCE. Notwithstanding any other provision of this
Agreement, you may not exercise the Option unless the Shares issuable upon
exercise are registered under the Securities Act or, if such Shares are not then
so registered, the Company has determined that such exercise and issuance would
be exempt from the registration requirements of the Securities Act. The exercise
of the Option must also comply with other applicable laws and regulations
governing the Option, and you may not exercise the Option if the Company
determines that such exercise would not be in material compliance with such laws
and regulations.

3. INCENTIVE STOCK OPTION QUALIFICATION. If so designated in your Grant Notice,
all or a portion of the Option is intended to qualify as an Incentive Stock
Option under federal income tax law, but the Company does not represent or
guarantee that the Option qualifies as such.

If the Option has been designated as an Incentive Stock Option and the aggregate
Fair Market Value (determined as of the grant date) of the shares of Common
Stock subject to the portions of the Option and all other Incentive Stock
Options you hold that first become exercisable during any calendar year exceeds
$100,000, any excess portion will be treated as a Nonqualified Stock Option,
unless the Internal Revenue Service changes the rules and regulations governing
the $100,000 limit for Incentive Stock Options. A portion of the Option may be
treated as a Nonqualified Stock Option if certain events cause exercisability of
the Option to accelerate.

4. NOTICE OF DISQUALIFYING DISPOSITION. To the extent the Option has been
designated as an Incentive Stock Option, to obtain certain tax benefits afforded
to Incentive Stock Options, you must hold the Shares issued upon the exercise of
the Option for two years after the Grant Date and one year after the date of
exercise. You may be subject to the alternative minimum tax at the time of
exercise. You should obtain tax advice when exercising the Option and prior to
the disposition of the Shares. By accepting the Option, you agree to promptly
notify the Company if you dispose of any of the Shares within one year from the
date you exercise all or part of the Option or within two years from the Grant
Date.

5. METHOD OF EXERCISE. You may exercise the Option by giving written notice to
the Company, in form and substance satisfactory to the Company, which will state
your election to exercise the Option and the number of Shares for which you are
exercising the Option. The

<PAGE>

written notice must be accompanied by full payment of the exercise price for the
number of Shares you are purchasing. At the discretion of the Plan
Administrator, you may make this payment in any combination of the following:
(a) by cash; (b) by check acceptable to the Company; (c) by using shares of
Common Stock you have owned for at least six months; (d) if the Common Stock is
registered under the Exchange Act, by instructing a broker to deliver to the
Company the total payment required; or (e) by any other method permitted by the
Plan Administrator.

6. TREATMENT UPON TERMINATION OF EMPLOYMENT OR SERVICE RELATIONSHIP. The
unvested portion of the Option will terminate automatically and without further
notice immediately upon termination of your employment or service relationship
with the Company or a Related Company for any reason ("Termination of Service").
You may exercise the vested portion of the Option as follows:

(a) General Rule. You must exercise the vested portion of the Option on or
before the earlier of (i) three months after your Termination of Service and
(ii) the Option Expiration Date;

(b) Disability. If your employment or service relationship terminates due to
Disability, you must exercise the vested portion of the Option on or before the
earlier of (i) one year after your Termination of Service and (ii) the Option
Expiration Date.

(c) Death. If your employment or service relationship terminates due to your
death, the vested portion of the Option must be exercised on or before the
earlier of (i) one year after your Termination of Service and (ii) the Option
Expiration Date. If you die after your Termination of Service but while the
Option is still exercisable, the vested portion of the Option may be exercised
until the earlier of (x) one year after the date of death and (y) the Option
Expiration Date; and

(d) Cause. The vested portion of the Option will automatically expire at the
time the Company first notifies you of your Termination of Service for Cause,
unless the Plan Administrator determines otherwise. If your employment or
service relationship is suspended pending an investigation of whether you will
be terminated for Cause, all your rights under the Option likewise will be
suspended during the period of investigation. If any facts that would constitute
termination for Cause are discovered after your Termination of Service, any
Option you then hold may be immediately terminated by the Plan Administrator.

The Option must be exercised within three months after termination of employment
for reasons other than death or Disability and one year after termination of
employment due to Disability to qualify for the beneficial tax treatment
afforded Incentive Stock Options.

IT IS YOUR RESPONSIBILITY TO BE AWARE OF THE DATE THE OPTION TERMINATES.

7. LIMITED TRANSFERABILITY. During your lifetime only you can exercise the
Option. The Option is not transferable except by will or by the applicable laws
of descent and distribution, except that Nonqualified Stock Options may be
transferred to the extent permitted by the Plan Administrator. The Plan provides
for exercise of the Option by a beneficiary designated on a Company-approved
form or the personal representative of your estate.

8. WITHHOLDING TAXES. As a condition to the exercise of any portion of an
Option, you

<PAGE>

must make such arrangements as the Company may require for the satisfaction of
any federal, state, local or foreign withholding tax obligations that may arise
in connection with such exercise.

9. OPTION NOT AN EMPLOYMENT OR SERVICE CONTRACT. Nothing in the Plan or any
Award granted under the Plan will be deemed to constitute an employment contract
or confer or be deemed to confer any right for you to continue in the employ of,
or to continue any other relationship with, the Company or any Related Company
or limit in any way the right of the Company or any Related Company to terminate
your employment or other relationship at any time, with or without Cause.

10. NO RIGHT TO DAMAGES. You will have no right to bring a claim or to receive
damages if you are required to exercise the vested portion of the Option within
three months (one year in the case of Disability or death) of the Termination of
Service or if any portion of the Option is cancelled or expires unexercised. The
loss of existing or potential profit in Awards will not constitute an element of
damages in the event of your Termination of Service for any reason even if the
termination is in violation of an obligation of the Company or a Related Company
to you.

11. BINDING EFFECT. This Agreement will inure to the benefit of the successors
and assigns of the Company and be binding upon you and your heirs, executors,
administrators, successors and assigns.

[INCLUDE SECTIONS 12 AND 13 FOR NON-U.S. RESIDENT OPTION GRANTS ONLY: 12.
LIMITATION ON RIGHTS; NO RIGHT TO FUTURE GRANTS; EXTRAORDINARY ITEM OF
COMPENSATION. By entering into this Agreement and accepting the grant of the
Option evidenced hereby, you acknowledge: (a) that the Plan is discretionary in
nature and may be suspended or terminated by the Company at any time; (b) that
the grant of the Option is a one-time benefit which does not create any
contractual or other right to receive future grants of options, or benefits in
lieu of options; (c) that all determinations with respect to any such future
grants, including, but not limited to, the times when options will be granted,
the number of shares subject to each option, the option price, and the time or
times when each option will be exercisable, will be at the sole discretion of
the Company; (d) that your participation in the Plan is voluntary; (e) that the
value of the Option is an extraordinary item of compensation which is outside
the scope of your employment contract, if any; (f) that the Option is not part
of normal or expected compensation for purposes of calculating any severance,
resignation, redundancy, end of service payments, bonuses, long-service awards,
pension or retirement benefits or similar payments; (g) that the vesting of the
Option ceases upon your Termination of Service for any reason except as may
otherwise be explicitly provided in the Plan or this Agreement or otherwise
permitted by the Plan Administrator; (h) that the future value of the Shares
underlying the Option is unknown and cannot be predicted with certainty; and (i)
that if the Shares underlying the Option do not increase in value, the Option
will have no value.

<PAGE>

13. Employee Data Privacy. BY ENTERING THIS AGREEMENT, YOU (A) AUTHORIZE THE
COMPANY AND YOUR EMPLOYER, IF DIFFERENT, AND ANY AGENT OF THE COMPANY
ADMINISTERING THE PLAN OR PROVIDING PLAN RECORDKEEPING SERVICES, TO DISCLOSE TO
THE COMPANY OR ANY OF ITS AFFILIATES ANY INFORMATION AND DATA THE COMPANY
REQUESTS IN ORDER TO FACILITATE THE GRANT OF THE OPTION AND THE ADMINISTRATION
OF THE PLAN; (B) WAIVE ANY DATA PRIVACY RIGHTS YOU MAY HAVE WITH RESPECT TO SUCH
INFORMATION; AND (C) AUTHORIZE THE COMPANY AND ITS AGENTS TO STORE AND TRANSMIT
SUCH INFORMATION IN ELECTRONIC FORM.]

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