Annex II Service Contract

ANNEX II SERVICE CONTRACT

This Annex II Service Contract (the "Annex") is entered into as of the day of , (the "Effective Date"), by and between Service Provider Name: , with principal place of business at (the "Service Provider"), and Client Name: , with principal place of business at (the "Client"). Service Provider and Client are sometimes referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS, the Parties have entered into a Master Services Agreement or similar agreement governing their commercial relationship and desire to set out specific services, service levels, fees and administrative arrangements applicable to the services described in this Annex; and

WHEREAS, Service Provider has the expertise, personnel and resources necessary to perform the Services described in this Annex and is willing to provide such Services to Client on the terms set forth herein; and

WHEREAS, the Parties intend for this Annex to supplement and form part of the Parties' agreement and to govern the performance, measurement and payment for the Services set forth below.

NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein, the Parties agree as follows:

1. DEFINITIONS

1.1 "Services" means the services to be performed by Service Provider under this Annex as described in Section 2. Terms defined in the Master Services Agreement have the same meanings when used in this Annex unless otherwise defined in this Annex.

1.2 "Deliverables" means the tangible outputs to be delivered to Client in connection with the Services, including reports, designs, software deliverables and documentation as specifically identified in Section 2.

2. SCOPE OF SERVICES

2.1 Description of Services. Service Provider shall provide the Services described below in accordance with the terms of this Annex. The Parties acknowledge that changes to the scope will be governed by Section 6 (Amendments).

2.2 Deliverables and Acceptance. Deliverables, acceptance criteria, and delivery dates shall be set forth in the schedule below or in attachments incorporated into this Annex. Acceptance shall be deemed to have occurred when Client confirms in writing that Deliverables materially conform to the applicable acceptance criteria, or if Client fails to provide written rejection with specific reasons within ten (10) business days of receipt.

3. SERVICE LEVELS

3.1 Service Levels. Service Provider shall meet the service levels specified below. Failure to meet service levels shall entitle Client to the remedies set forth herein.

3.2 Service Credits. If Service Provider fails to meet the availability target for a given calendar month, Service Provider shall credit Client an agreed percentage of the fees for that month, calculated in accordance with the schedule set forth in the Service Level Attachment or, if none, at 5% of the monthly fee for each full 1% below target, not to exceed 50% in aggregate for the month. Service credits are Client's sole and exclusive remedy for availability failures.

4. FEES AND PAYMENT

4.1 Fees. Client shall pay Service Provider the fees set forth in this Section and any schedules incorporated herein. Fees are exclusive of applicable taxes and reasonable out-of-pocket expenses unless otherwise stated.

4.2 Invoicing. Service Provider shall invoice Client in accordance with the payment schedule. Invoices shall include reasonable detail of Services performed and Deliverables provided. Unless otherwise disputed in good faith in writing within fifteen (15) days of receipt, invoices shall be deemed accepted.

5. TERM AND TERMINATION

5.1 Term. The term of this Annex shall commence on the Effective Date and continue for the period set forth below unless earlier terminated in accordance with this Section.

5.2 Termination for Cause. Either Party may terminate this Annex upon written notice if the other Party materially breaches this Annex and fails to cure such breach within thirty (30) days after receipt of written notice specifying the breach.

5.3 Termination for Convenience. Either Party may terminate this Annex for convenience upon sixty (60) days' prior written notice to the other Party. Upon termination, Client shall pay Service Provider for Services performed and Deliverables provided through the effective date of termination, subject to Client's right to offset for uncured breaches.

6. PERSONNEL AND SUBCONTRACTING

6.1 Personnel. Service Provider shall assign qualified personnel to perform the Services. Service Provider shall remain responsible for the performance of subcontractors and agents and shall ensure compliance with the terms of this Annex.

7. CONFIDENTIALITY

7.1 Confidential Information. Each Party shall protect the other Party's Confidential Information with at least the same degree of care it uses to protect its own confidential information, but in no event less than reasonable care. Confidential Information shall be used solely for the performance of this Annex.

7.2 Exclusions. Confidential Information does not include information that: (a) is or becomes publicly available through no fault of the receiving Party; (b) is rightfully received from a third party without restrictions; or (c) is independently developed without use of the disclosing Party's Confidential Information.

8. INTELLECTUAL PROPERTY

8.1 Ownership. Except as expressly provided herein, each Party retains all right, title and interest in and to its pre-existing intellectual property. Subject to payment in full, Service Provider assigns to Client all right, title and interest in Deliverables created specifically for Client under this Annex; provided, however, that Service Provider retains ownership of its general know-how, tools, methodologies and software not specifically developed for Client.

8.2 License. To the extent Service Provider retains ownership of any Background IP used in connection with the Deliverables, Service Provider grants Client a non-exclusive, non-transferable, worldwide license to use such Background IP solely to use the Deliverables for Client's internal business purposes.

9. LIABILITY AND INDEMNIFICATION

9.1 Indemnification. Each Party shall indemnify, defend and hold harmless the other Party from and against third-party claims arising out of the indemnifying Party's gross negligence or willful misconduct, or material breach of this Annex.

9.2 Limitation of Liability. Except for liability arising from a Party's gross negligence, willful misconduct, or a party's indemnification obligations under this Annex, neither Party's aggregate liability to the other shall exceed the total fees paid or payable to Service Provider under this Annex in the twelve (12) months preceding the event giving rise to liability. In no event shall either Party be liable for consequential, special or punitive damages.

10. INSURANCE

Service Provider shall maintain insurance appropriate to the Services performed, including commercially reasonable general liability and professional liability (errors and omissions) insurance. Upon request, Service Provider shall provide certificates evidencing such insurance.

11. NOTICES

All notices required or permitted under this Annex shall be in writing and delivered to the addresses set forth below or to such other address as a Party may designate in writing in accordance with this Section.

12. AMENDMENTS; WAIVER

No amendment or waiver of any provision of this Annex shall be effective unless in writing and signed by duly authorized representatives of both Parties. No failure or delay by a Party in exercising any right shall constitute a waiver of that right.

13. GOVERNING LAW

This Annex shall be governed by and construed in accordance with the laws of the state or jurisdiction specified below, without regard to its conflict of law principles.

14. ENTIRE AGREEMENT

This Annex, together with the Master Services Agreement and any attachments or schedules expressly incorporated herein, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, proposals and communications, whether oral or written.

15. SEVERABILITY

If any provision of this Annex is held to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.

16. COUNTERPARTS

This Annex may be executed in counterparts, each of which when executed and delivered shall constitute an original, and all of which together shall constitute one and the same instrument. Signatures delivered electronically or by facsimile shall have the same force and effect as original signatures.

17. MISCELLANEOUS

The Parties acknowledge that provisions expressly set forth in this Annex shall control over any inconsistent provisions in any other agreement between the Parties to the extent of the inconsistency.

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